The Canadian dollar dropped against its US peer on Monday as the news about the Greek bailout deal did not prevent the greenback from rallying. The loonie was stronger against other currencies, including the euro and the Japanese yen.
The positive news from Europe did not deter the US dollar from rallying as traders now focus on the probable interest rate hike from the Federal Reserve later this year. Additionally, there are chances that Greece will not get the bailout anyway, fueling the dollar’s rally.
As for domestic fundamentals, market participants concentrated on the upcoming monetary policy meeting of Canada’s central bank on Wednesday. Prospects for a rate cut are detrimental to the Canadian dollar’s performance. Saying that, the last week’s better-than-expected employment data decreased chances of such an event.
USD/CAD rose from 1.2701 to 1.2739 as of 21:43 GMT today, touching the high of 1.2789. EUR/CAD was down from 1.4094 to 1.4016 following the earlier rally from 1.4210. CAD/JPY gained from 96.52 to 96.87.
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