The Canadian dollar strengthened on the speculation that the financial crisis in the Europe may worsen and after the proposed tax cuts were accepted by the US Senate.
The US Senate passed the $858 billion tax cut plan, offered by the President Barack Obama, which should bolster the economy of the US, the biggest trading partner of Canada. The resulting optimism about the US economy spilled over into the Canadian economy.
Europe still remains in the focus of the news, and its economic situation looks worse than the economic environment in Canada and the US. The fundamentals began to improve for Canada, the outlook which was supported by growing factory sales posting the increase by 1.7 percent. The consumer prices and the factory production in the US also posted the advance.
USD/CAD traded at 1.0042 as of 00:48 GMT today after it dropped from 1.0062 to 1.0000 yesterday. EUR/CAD traded at about 1.3280, following the decline from 1.3457 to 1.3275.
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