Canadian Dollar Sinks on Surprisingly Bad Fundamentals

The Canadian dollar slumped today as macroeconomic reports were abysmal, frustrating Forex market participants who have counted on much better data. Concerns about possible quantitative easing tampering by the US Federal Reserve added to the weakness of the currency.
Building permits shrank 10.3 percent in June from May, demonstrating the first decline in six months. The Ivey Purchasing Managers’ Index edged down from 55.3 in June to 48.4 in July instead of rising to 56.3 as was expected. The value below 50.0 indicates industry contraction.
The data was completely terrible and it resulted in a sharp drop of the Canadian currency. Falling commodity prices were not helping either. The Standard & Poor’s GSCI index of raw materials lost 0.6 percent today.
USD/CAD climbed from 1.0373 to 1.0414 as of 17:55 GMT today and its daily high was at 1.0443. EUR/CAD jumped from 1.3801 to 1.3893, trading near the highest level since November 11. CAD/JPY tumbled from 94.16 to 92.64, touching the weakest price since June 26.

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