The Canadian dollar fell for the first day in four against its US counterpart and was flat versus the euro and the Japanese yen on the outlook for monetary policies of Canada’s and the US central banks.
It is expected that the Federal Reserve will continue to reduce its monetary stimulus after tapering quantitative easing this month as the US economy becomes stronger. Today’s data suggested that economic recovery is indeed gaining momentum. The Bank of Canada, on the other hand, did not show readiness to tighten monetary policy. The difference between the policy outlooks was not in favor of the Canadian currency.
The loonie (as the currency is nicknamed for the image of an aquatic bird on C$1 coin) fell even as prices for crude oil were rising. Futures on crude gained 0.31 percent to $99.22 per barrel in New York today.
USD/CAD rose from 1.0605 to 1.0633 intraday and closed at 1.0617 today. EUR/CAD closed at 1.4520, near the opening of 1.4524, CAD/JPY rose a little from 98.11 to 98.17.
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