The sharp and strong economic recovery expected by some analysts for this year has not yet been confirmed, and new concerns regarding the global economic future influenced negatively the demand for Canadian exports and consequently for its currency.
The Canadian dollar was affected today by several negative events coming from different parts of the world, which affected not only the loonie but all currencies tied to growth, as the U.S. consumer confidence tumbled much below what forecasts suggested, following a series of frustrating reports published earlier in Europe. Demand for metallic and energetic commodities declined today as uncertainty is growing in the world’s most economically active countries, which also pushed equities markets down in the majority of stock exchanges. The Canadian currency has been subject to strong volatility in the past week, as the future of the U.S. and Europe’s economy remain cloudy.
The suggestions that the Canadian dollar would reach parity with its U.S. counterpart anytime soon are certainly gone by now, according to analysts. The international scenario is not the most optimistic, and domestically, Canada doesn’t provide support for an eventual rally on the loonie’s charts, as interest rates are not expected to be hiked soon.
USD/CAD traded at 1.0552 as of 20:08 GMT from a previous intraday rate of 1.0430. CAD/JPY fell again, reaching 85.40 from 87.38.
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