Canadian forex review: C$ ends sharply lower

By Commodity News Service Canada

WINNIPEG, Jan. 29 – The Canadian dollar ended sharply lower relative to the US dollar on Thursday, shedding more than half a cent.

Much of the drop was linked to a strengthening US dollar, which was supported by ideas that the US Federal Reserve will raise interest rates sooner, rather than later, analysts said.

The Canadian dollar closed at US$0.7930 or US$1=C$1.2611 on Thursday, which compares with Wednesday’s North American settlement of US$0.7987 or US$1=C$1.2520.

Ongoing worries about slow global economic growth and the negative impact weak oil prices will likely have on Canada’s economy also undermined the loonie.

However, oil prices saw a rebound on Thursday, which was limiting the downside.

Canadian bonds ended slightly lower on Thursday, seeing a downward correction after moving sharply higher throughout the week, traders said.

The two-year bond yielded 0.456% Thursday, from 0.439% late Wednesday. The 10-year bond yielded 1.363%, from 1.355%. Bond yields fall as their prices rise.