Canadian forex review: C$ plunges with crude oil

By Commodity News Service Canada

WINNIPEG, July 22 – The Canadian dollar plunged sharply lower against the US dollar on Wednesday, undermined by weakness in the crude oil market – as the commodity is one of Canada’s biggest exports.

The Canadian dollar closed at US$0.7670 or US$1=C$1.3037 on Wednesday, which compares with Tuesday’s North American settlement of US$0.7723 or US$1=C$1.2948.

Strength in the US dollar, as traders flocked towards safe-haven assets amid global economic uncertainty, was also bearish for the Canadian dollar.

Last week’s interest rate cut from the Bank of Canada and ongoing expectations that the US Federal Reserve will raise rates later this year were also overhanging the currency.

There was no significant Canadian economic data moving the currency on Wednesday. Thursday’s Canadian retail sales data will help provide direction for the loonie. Pre-report guesses call for an increase of 0.5 per cent.

Canadian bonds were mixed on Wednesday, according to reports.