The Canadian dollar advanced for the first time this week this Tuesday, as markets with strong correlation with the loonie provided support for the currency to gain specially versus its U.S. counterpart, but as well as important currencies globally.
After the loonie traded near parity with the greenback last week, the currency experienced a considerable fall as traders considered the rally excessive, specially after the crude oil ended the strongest rally in 2010 towards the end of last week’s session, affecting Canada’s dollar performance as it accounts for a good percentage of the Canadian exports’ revenues. Pessimism in Europe regarding a week economic performance in Norway and Greece’s budget deficit also contributed for the loonie’s advance today.
The loonie seems to be have found its way back towards parity once again, as commodities as stocks rebounded today. European markets are, for the moment, unattractive, and, as the Fed signaled that rate hikes aren’t coming so soon, the Canadian dollar is one of the best bets for the moment in forex markets.
USD/CAD traded at 1.0170 as of 04:01 GMT from as high as 1.0225 during Tuesday’s session.
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