Canadian forex review: C$ sharply lower

By Commodity News Service Canada

WINNIPEG, August 21 – The Canadian dollar closed sharply lower compared to its US counterpart on Tuesday, dropping more than a three-quarters of a cent following the release of minutes from a recent US Federal Open Market Committee meeting.

According to traders, the minutes from the meeting didn’t give much direction to when exactly the US Federal Reserve will start easing out of stimulus, but they expect it will be sooner, rather than later.

The Canadian currency was quoted at US$0.9548, or US$1=C$1.0473 at the close on Wednesday, which compares with Tuesday’s North American close of US$0.9626, or US$=C$1.0389.

Some of the weakness seen in commodities, including crude oil, gold and copper, spilled over to further weigh on the Canadian dollar.

Canadian bonds moved sharply lower on Wednesday, reacting to the release of the US Federal Open Market Committee meeting, brokers said.

The two-year bond yielded 1.216% late Wednesday, from 1.192% late Tuesday. The 10-year bond yielded 2.744%, from 2.682%. Bond yields fall as their prices rise.