Canadian Dollar Falls on Cratering Oil Prices, Weaker Manufacturing Data

The  Canadian dollar is tumbling on  Thursday, thanks to  crude oil prices slipping below the  key $70 threshold and  weak manufacturing data. The  loonie had surged to  a  11-day high on  Wednesday before retreating against several other currencies.

According to  the  US Energy Information Administration (EIA), domestic crude inventories climbed by  6.5 million barrels for  the  week ending October 12, which is higher than the  market forecast of  1.88 million barrels. Gasoline supplies decreased by  two million barrels, while distillate stockpiles declined by  800,000 barrels.
November West Texas Intermediate (WTI) crude futures plunged $1.16, or  1.66%, to  $68.59 per barrel on  the  New York Mercantile Exchange. Oil prices fell as  much as  3% before paring some of  those losses.
Crude oil continues to  be one of  Canada’s biggest exports, and  the  economy is sensitive to  the  trends in  the  international crude market.
Statistics Canada reported that manufacturing sales dropped 0.4% to  $58.6 billion in  August, less than the  0.6% analysts had anticipated. Sales were down in  seven of  the  21 industries monitored by  the  statistics agency, accounting for  a  little more than half of  the  national manufacturing sector. The  motor vehicle industry led the  way with sales plummeting 8.3% to  $4.9 billion.
Traders will now look ahead to  the  consumer price index (CPI) and  Core Retail Sales on  Friday.
The  loonie took another hit after the  Federal Reserve released minutes from its latest Federal Open Market Committee (FOMC) policy meeting. The  minutes Federal Reserve from majority of  the  members pertaining to  raising interest rates until the  US economy cools down. The  central bank is expected to  pull the  trigger on  another rate hike in  December.
This comes as  the  Bank of  Canada (BOC) is widely expected to  raise rates by  25 basis points at  next week’s monetary policy meeting.
The  USD/CAD currency pair rose 0.18% to  1.3047, from an  opening of  1.3021, at  14:28 GMT on  Thursday. The  EUR/CAD advanced 0.17% to  1.5000, from an  opening of  1.4972.

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