The Canadian dollar fell yesterday and maintained its losses today as the threat of the fiscal cliff resurfaced in the news headlines, making investors avoid riskier assets in favor of safer ones.
The fiscal cliff in the United States, the major trading partner of Canada, was postponed, but not averted altogether. Now, market participants are worried yet again about the automatic budget cuts, also known as budget sequestration. The vast majority of specialists think that such cuts would be destructive for the US economy.
Crude oil fell, adding to woes of the Canadian currency. The loonie, as the currency is nicknamed, reached the lowest level since July versus its US counterpart amid all the negative factors.
USD/CAD traded at 1.0114 as of 00:51 GMT today after climbing to 1.0136 yesterday. EUR/CAD went up from 1.3534 to 1.3566. CAD/JPY fell from 92.91 to 92.51 yesterday and remained near that level today.
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