Canadian Dollar Moves Lower Even as Crude Oil Rallies

The Canadian dollar fell a bit today even as prices for crude oil, Canada’s major export, rallied during the Monday’s session. Market analysts argued that the reason for that is diminishing prospect for an interest rate hike from the Bank of Canada.

At the start of October, speculators priced in about 75% chance of a hike before the year end. But now, the probability is less than 50%. Economists claimed that the recent economic data was not nearly good enough to warrant tighter monetary policy. Indeed trade and employment figures released at the start of the month missed expectations, meaning that the Canadian economy was not as robust as specialists had thought.

Futures for North American crude rallied 0.8% today, while the international benchmark Brent grade jumped more than 1%. That is because Iraqi military forces moved in to seize oil fields in the Kurdinstan, the region that is responsible for about 75% of Iraq’s oil exports, driving away the forces of Iraqi Kurds.

USD/CAD advanced from 1.2475 to 1.2520 as of 20:11 GMT today, reaching the daily high of 1.2557. EUR/CAD was up from 1.4738 to 1.4763. CAD/JPY traded at 89.56, not far from the opening of 89.53, after falling to the low of 88.98 intraday.

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