Canadian dollar is slipping today after a rather spectacular performance yesterday. Focus has turned from the good economic data posted by China and the equity performance that followed, and turned to look at the economic data out of Canada. The latest trade deficit is weighing on the loonie today.
Yesterday, risk appetite pushed the Canadian dollar higher. Expectations that China would help pull the global economy out of its funk helped the loonie, as did expectations for higher demand for oil. Today, though, there is a different feeling regarding the Canadian dollar, due mostly to the latest trade deficit.
According to Statistics Canada, the trade deficit for November was revised up to C$1.96 billion. The revisions indicates that perhaps the Canadian economy is struggling. Canada has been dealing with a slump due to reduced exports, and the widening trade deficit only emphasizes that. For an economy that relies heavily on its exports (particularly oil), the news is disappointing.
Loonie has managed to limit some of its losses against the US dollar today, and it is actually gaining a little against the UK pound, a currency that is experiencing its own troubles due to economic concerns.
At 15:27 GMT USD/CAD is higher at 0.9839, up from the open at 0.9832. GBP/CAD is down to 1.5861 from the open at 1.5897. EUR/CAD is up to 1.3125 from the open at 1.3026.
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