Loonie Continues to Weaken Against the Greenback

The Canadian dollar continues to weaken against the greenback, thanks in large part to the recent difficulties with oil prices, and with commodity prices in general. The loonie is still maintaining its gains over the European currencies, though, mainly because of the relative strength of its economy.

Loonie is once again lower against the US dollar as policy divergence and lower commodities favor the greenback. Even though there is speculation that the Bank of Canada might start raising its own rate soon, the fact of the matter is that most of the focus is on the Federal Reserve in the United States.

The dollar’s strength is weighing on commodities like oil and gold, and that means a little weakness for the loonie, which is a commodity currency and especially dependent on oil prices. Even with oil prices recovering a little bit, they are still near recent lows.

Canadian dollar is gaining against the European currencies, however. Speculation about the BOC, and evidence that the Canadian economy is picking up, puts the loonie ahead of the game as compared to euro and pound.

At 10:43 GMT USD/CAD is up to 1.1172 from the open at 1.1164. EUR/CAD is down to 1.4073 from the open at 1.4164. GBP/CAD is down to 1.8087 from the open at 1.8133.

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