The Canadian dollar posted a weekly loss, falling for the third week against its US counterpart, as signs of economic slowdown across the world damped investors’ demand for riskier assets tied to economic growth.
This week wasn’t pretty for the Canadian currency (often nicknamed “loonie”). It’s no surprise, really, considering almost total absence of good news from Canada. Wholesale sales unexpectedly dropped, retail sales came out worse than predicted. To be fair, there were some good reports: leading indicators were somewhat better than expected and inflation data wasn’t bad, but anything good that came from Canada was mitigated by bad data from abroad.
Economic reports from China and Europe didn’t added confidence to Forex traders and subdued their willingness to buy higher-yielding assets. Even the United States made speculators worried by the end of the week as new home sales report on Friday showed decline of sales, while a small increase was anticipated.
The result of all the negative signs was obvious: the loonie was falling for the most part of the week. The currency ended its impressive 8-week rally against the yen, fell for the second week versus the euro and posted the third weekly decline in a row against the greenback.
USD/CAD was up from 0.9911 to 0.9974, while during the week the currency pair advanced above parity to 1.0033. EUR/CAD rose from 1.3059 to 1.3234 and CAD/JPY went down from 84.09 to 82.45.
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