The Canadian dollar fell yesterday, following the drop of stocks, and remained weak today as concerns for global economic growth return to investors. The currency managed to advance versus the Japanese yen today, even though it has posted losses yesterday.
The Standard & Poorâs 500 Index fell 0.1 percent yesterday. Crude oil fluctuated between gains and losses. Traders are worried that the situation in Europe may deteriorate as officials are reluctant to take decisive steps for combating the sovereign-debt crisis. On top of that, China’s economic slowdown makes things look even bleaker.
One could expect that the loonie would fall against safer currencies, and indeed it fell versus the US dollar, but the Canadian currency managed to outperform the yen. It was not surprising as the slowing economic growth hurt the appeal of the Japanese currency, but it does look somewhat strange that JPY weakened against CAD today, not yesterday.
USD/CAD rose from 0.9923 to 0.9936 and EUR/CAD advanced from 1.2238 to 1.2262 as of 4:33 GMT today. CAD/JPY was up from 78.88 to 79.10 before retreating to the opening level.
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