The Canadian dollar was attempting to move lower on Wednesday after showing a decent performance on Tuesday despite the drop of crude oil prices.
Usually, the loonie moves in tandem with crude oil — the major export of Canada. Yet it was not doing so on Tuesday, the same as on Monday. Unlike on Monday though, the currency was moving up while the commodity was moving lower.
The reason for the currency’s strength was the victory of Hillary Clinton over Donald Trump in the US presidential debates. Markets tend to prefer candidates from the same party of the incumbent president. Therefore, for investors, Clinton represents stability and status quo while Trump represents uncertainty and potential disruptions to international trade and foreign deals. This is an especially important factor for currencies of US trading partners, like the Canadian dollar and the Mexican peso.
USD/CAD was down from 1.3225 to 1.3195 yesterday but almost reversed its losses today, trading at about 1.3217 as of 1:36 GMT today. EUR/CAD was down from 1.4883 to 1.4789 but bounced to 1.4818 on Wednesday. CAD/JPY rose from 75.83 to 76.07 yesterday and stayed near that level today.
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