As most other currencies, the Canadian dollar opened sharply lower today due to risk aversion caused by the North Korean nuclear test. Yet after volatile swings, the currency stabilized and did not move far from its opening level.
The Canadian dollar is considered to be a risky commodity currency as opposed to safe currencies like the yen or the franc. That makes the loonie susceptible to deterioration of the market sentiment as it demonstrated today.
Trading was somewhat subdued today due to holidays in Canada and the United States. The rest of the week will be plenty eventful, though, with policy meetings of several central banks, including the Bank of Canada. Additionally, Canada’s trade balance and employment data will be released over the week.
USD/CAD traded at 1.2411 as of 17:14 GMT today, not far from the opening of 1.2418, but above the Friday’s close of 1.2393. EUR/CAD closed at 1.4699 on Friday, opened sharply higher at 1.4756 today, and is currently trading little changed at 1.4764. CAD/JPY was at about 88.32, compared to the Friday’s close 88.93, the Monday’s opening of 88.10 and the day’s high of 88.76.
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