The Canadian Dollar has weakened for a seventh-day in a row against its US relation due to growing concerns over the state of the Canadian economy and as Britain became the latest nation to be added to the growing list of nations stripped of the top credit rating.
So far February has not been kind to the ‘Loonie’ due to a number of factors. These include sliding commodities, worries about the strength of the Canadian housing sector and the price differential between benchmark Brent crude and Western Canadian Select from the oil sands.
“In light of the recent weakness, persistently soft data and lacklustre economic outlook we’ve downgraded our call on the Dollar, with the currency now expected to strengthen at a more subdued pace over the next year ending 2013 at parity,” said BMO Nesbitt Burns senior economist Benjamin Reitzes.
Concerns over the health of the US economy, Canada’s biggest trading partner are also dampening investor demand for the currency. The Federal Reserve revealed that it may be considering abandoning its monetary easing sooner than economists had been predicting.
Britain’s downgrade from its much coveted AAA rating has also proven to be detrimental to the Loonies fortunes. The outcome of the Italian elections is also very likely to impact the movement of the ‘Loonie’. If a weak government is elected then the currency will weaken further as investors seek safety in the US Dollar. So far this week appetite for riskier currencies has fallen, boosting the Greenback.
Canadian Dollar traders should be aware of Friday’s release of Canada’s latest GDP figures. Economists are expecting the nation to post growth of 0.7% for the fourth quarter of 2012.
Current Canadian Dollar Exchange Rates
The Canadian Dollar to Euro (CAD/EUR) exchange rate is trading at 0.7380
The Canadian Dollar to Pound Sterling (CAD/GBP) exchange rate is trading at 0.6452
The Canadian Dollar to US Dollar (CAD/USD) exchange rate is trading at 0.9768
The Canadian Dollar to Australian Dollar (CAD/AUD) exchange rate is trading at 0.9489
The Canadian Dollar to New Zealand Dollar (CAD/NZD) exchange rate is trading at 1.1648
The Canadian Dollar to Japanese Yen (CAD/JPY) exchange rate is trading at 91.7070
These exchange rates were correct as of 14:25 pm GMT
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