Loonie Rallies Against Major Currencies as Oil Rises

Canadian dollar is heading higher today, gaining ground against its major counterparts as oil prices continue to recover to some degree. There are expectations for more loonie weakness in the future, but for now the currency is ahead.

Loonie has been rallying a little bit, thanks in large part to higher oil prices. Oil is gaining right now, as worries about the situation in Nigeria prompt concern about supply. Oil output disruptions in Nigeria are causing problems, especially when added to other output disruptions around the world this year, particularly in the Middle East.
The result of these disruptions, according to a forecast from Goldman Sachs, is that there is no longer an oversupply of oil on the market. Now we are starting to look at a deficit.
As oil prices rise, the loonie benefits, as Canada relies heavily on its own oil revenues for economic support. However, some analysts think this rally will be short-lived as there might be some other economic concerns weighing on the Canadian dollar.
At 13:36 GMT USD/CAD is down to 1.2897 from the open at 1.2946. EUR/CAD is also lower, dropping down to 1.4612 from the open at 1.4651. GBP/CAD is down as well, falling to 1.8542 from the open at 1.8592.

If you have any questions, comments or opinions regarding the Canadian Dollar,
feel free to post them using the commentary form below.

Leave a Reply

Your email address will not be published. Required fields are marked *