Crude Oil Prices Drag Canadian Dollar Down

The Canadian dollar sank yesterday and retained its weakness today as falling crude oil prices dragged the currency down along with them. The drop of the US dollar could have helped the loonie, but in practice it had a minimal impact if any at all.

Crude oil continued to fall, trading below the $50 level. Prices dropped on Wednesday due to the unexpected buildup of US reserves that increased concerns about oversupply on the market. Canada’s economy has strong dependency on oil exports, making the falling prices a bad news and a reason for the Canadian currency to drop.

The drop of the US dollar helped some currencies to gain but provided little benefit for the loonie. The Canadian dollar is attempting to reserve yesterday’s losses today, but has had a very limited success so far.

USD/CAD traded at 1.3115 as of 2:47 GMT today after climbing from 1.3057 to 1.3127 yesterday. EUR/CAD continued to move up, rising from 1.4594 to 1.4604 during the current trading session. CAD/JPY was up from 94.28 to 94.46 following yesterday’s dive by 1 percent.

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