During European trading the ‘Loonie’ brushed a three-year low against its US counterpart as investors were spooked by the looming Bank of Canada rate decision and turned away from the commodity-driven currency.
The Canadian Dollar Exchange Rate was in the region of 0.5733 against the British Pound as of 15:50 GMT
The ‘Loonie’ was holding comparatively steady against Sterling however as the British currency faltered as a result of a slightly disappointing UK services report.
With economists forecasting that the patchy data emerging from Canada in recent weeks would prompt the BOC to hint at the prospect of an additional interest rate cut, the Canadian Dollar came under pressure against several of its major rivals.
For over a year the central bank used the monthly policy statements to intimate that rates might be increased, but its stance has become more dovish of late.
The CAD/GBP exchange rate hit a low of 0.5701
As market analyst Joe Manimbo commented yesterday; ‘The divergent view in monetary policies in Ottawa compared to Washington will keep the Loonie weak. Whether there’ll be a rate cut tomorrow, the upside bias for Dollar-Canada remains unchanged’.
He later followed this by stating; ‘The Fed is seen scaling back policies before too long – that contrasts with expectations that it’ll be a year or more before we see a rate rise from Canada.’
Although the BOC was largely expected to leave rates unaltered this month, the Canadian Dollar still consolidated losses as the meeting drew closer.
During North American trading the CAD/USD pairing experienced modest movement as US trade balance data showed that the nation’s deficit narrowed in October.
A separate report revealed that the world’s largest economy added 215,000 positions in November following a positively revised gain of 184,000 in October.
After the BOC delivered its rate announcement, leaving rates unaltered and warning of the likelihood of inflation remaining below target, the Canadian Dollar extended declines against the ‘Buck’ and struggled against several of its other major currency rivals.
BOC Governor Stephen Poloz said this of the decision; ‘The Bank judges that the substantial monetary policy stimulus currently in place remains appropriate. The risks associated with elevated household imbalances have not materially changed, while the downside risks to inflation appear to be greater.’
However, CAD/USD losses were slightly limited by the news that the US ISM non-manufacturing composite index fell by more-than-forecast, dropping from 55.4 in October to 53.9 in November.
The figure did however remain well above the fifty mark separating growth from contraction.
Tomorrow the Bank of England rate decision may impact the CAD/GBP pairing but Canadian building permits data and the nation’s Ivey purchasing managers index will also be of interest.
Current Canadian Dollar (CAD) Exchange Rates:
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The Canadian Dollar/US Dollar Exchange Rate is currently in the region of: 0.9376 <
The Canadian Dollar /Euro Exchange Rate is currently in the region of: 0.6933 >
The Canadian Dollar/Pound Sterling Exchange Rate is currently in the region of: 0.5733 >
The Canadian Dollar/Australian Dollar Exchange Rate is currently in the region of: 1.0388 >
The Canadian Dollar /New Zealand Dollar Exchange Rate is currently in the region of: 1.1465 >
The Pound Sterling/Canadian Dollar Exchange Rate is currently in the region of: 1.7459 >
The US Dollar/ Canadian Dollar Exchange Rate is currently in the region of: 1.0665 >
The Euro/Canadian Dollar Exchange Rate is currently in the region of: 1.4494 >
The New Zealand Dollar/Canadian Dollar Exchange Rate is currently in the region of: 0.8723 <
The Australian Dollar/Canadian Dollar Exchange Rate is currently in the region of: 0.9627 <
(Correct as of 15:50 GMT)
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