The Canadian dollar rallied against the euro today as political turmoil in Spain undermined the strength of the shared European currency. The loonie erased its gains versus the US dollar and fell against the Japanese yen after reaching the highest level since May 2010.
It looked like the situation in Europe was stabilizing, but fears unexpectedly reemerged after the corruption scandal. Newspapers reported that Spanish Prime Minister Mariano Rajoy has accepted illegal cash payments. At the same time, polls showed that former Italian Prime Minister Silvio Berlusconi is gaining popularity even as he has his own clash with the law, adding to political uncertainty in Europe.
The performance of CAD was good versus EUR, but less than stellar against USD and JPY. Overall, market analysts are neutral on the currency as there not many events to guide it as of now.
EUR/USD dropped from 1.3602 to 1.3482 as of 19:02 GMT today. USD/CAD advanced from 0.9964 to 0.9987 after falling to 0.9946. CAD/JPY advanced from 93.03 to the high of 93.56, but later slid to 92.46.
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