Canadian dollar is heading a little bit higher today, gaining as concerns about the tropical storm known as Isaac heads for the Gulf of Mexico. Oil prices are seeing a bit of a boost, and that is helping the loonie on the Forex market.
Oil prices are moving higher today, due to concerns that Isaac could impact oil operations in the Gulf of Mexico. In 2008, hurricanes disrupted oil operations in the Gulf, creating an issue with supply. There is a similar fear right now, especially after the news of a refinery explosion in Venezuela.
With uncertainty over the path of the tropical storm, and its impact, oil prices are on the rise. This helps the Canadian dollar. The loonie derives a great deal of support from oil prices, since the Canadian economy exports a great deal of oil. When oil prices rise, the Canadian dollar usually sees a boost as well — particularly against the US dollar.
For now, loonie is doing reasonably well, and it is likely to continue to see some support as long as oil prices head higher due to Isaac.
At 13:26 GMT USD/CAD is lower, down to 0.9904 from the open at 0.9924. GBP/CAD is also lower, heading down to 1.5658 from the open at 1.5699. EUR/CAD has slipped to 1.2402 from the open at 1.2403.
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