Canadian Dollar Falls on Weak Oil Prices, Spikes On In-Line GDP Data

The  Canadian dollar today extended its losses against the  US dollar for  the  third consecutive day as  global crude oil prices fell to  lows last seen in  December 2018. The  Commodity-linked loonie’s performance was boosted slightly by  the  Canadian GDP data, but the  risk-off market sentiment created by  the  Chinese coronavirus headlines hindered its rally.
The USD/CAD currency pair today rallied to a high of 1.3465 from an opening low of 1.3386 but as off its daily highs at the time of writing.
The  Canadian dollar has been losing ground against the  weakening greenback driven by  the  massive plunge in  global crude oil prices this week. Coronavirus fears drove the drop in crude oil prices as  investors expect global demand to  decline even as  OPEC+ struggle to  cut their output. The  release of  the  Canadian GDP report for  Q4 2019 by  Statistics Canada triggered a  brief spike by  the  loonie as  the  print met expectations by  coming in  at  0.3%. However, the jump was short-lived as  the  West Texas Intermediate continued to  trade near 44.96, putting it on  track for  a  15% weekly loss.
The  release of  weak US personal consumption expenditure report for  January by  the  Bureau of  Economic Analysis had a  muted impact on  the  currency pair, despite American personal spending contracting in  January. The  greenback’s weakness, as  reflected in  the  US Dollar Index did not help the  loonie, which was much weaker than the  dollar.
The  currency pair’s performance over the  weekend is likely to  be affected by  crude oil prices and  geopolitical events.
The USD/CAD currency pair was trading at 1.3458 as at 14:23 GMT having risen from a low of 1.3386. The CAD/JPY currency pair was trading at 80.61, having dropped from a high of 81.92.

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