Loonie Slips after Seeing Earlier Gains

Canadian dollar is slipping today, after heading higher in earlier trading. Many currencies are fluctuating on the currency market today, thanks to the uncertainty in the markets right now. Earlier, the loonie had seen some gains as disappointing data in the United States dropped the greenback. Now, though uncertainty is weighing on the Canadian dollar.

Initially, when the US nonfarm payrolls for April were released and the disappointing result was seen, the Canadian dollar got a boost against the US dollar. With greenback disappointing traders, the loonie went higher. Additionally, the Canadian dollar also got a bit of a boost against European currencies on the expectation of at least some upheaval as elections in Greece and France are this weekend — and Nicolas Sarkozy could actually lose in France.
Now, though, risk aversion is setting in and the loonie is reversing some of its gains. High beta currencies don’t fare well in this sort of uncertain environment, especially against the US dollar. It’s also not helping the Canadian dollar that oil prices are once again falling. The loonie relies on oil prices for support, and they are plunging, heading back toward $100 a barrel.
At 13:25 GMT USD/CAD is up to 0.9915 from the open at 0.9885. GBP/CAD is up to 1.6050 from the open at 1.5990.

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