Canadian Dollar Slides As Oil Prices Decline
19 May 2015 - 9:41PM
RTTF2
The Canadian dollar fell against most major counterparts in
European deals on Tuesday, as oil prices fell amid a strong dollar
and on worries over supply glut coupled with weak demand.
Crude for July delivery fell $0.46 to $59.78 a barrel.
A strong dollar normally discourages buying dollar-denominated
commodities such as crude oil since they become more expensive to
holders of foreign currencies.
Saudi Arabia, the world's largest exporter of oil, increased its
crude oil production to 10.308 million barrels per day in April,
compared to 10.29 million barrels in March, data showed
yesterday.
Indications that OPEC is not willing to reduce oil production at
its next month meeting sparked concerns over supply outlook.
Meanwhile, Kuwait OPEC Governor Nawal al-Fuzaia on Monday told
the excess supply in oil market is being led by increase in shale
oil production and slow demand, and not from OPEC.
The currency showed mixed trading in the previous session. The
loonie held steady against the aussie but rose against the yen and
the euro. Against the greenback, the loonie declined.
The loonie depreciated to 98.38 against the yen, its lowest
since May 7, and was down by 0.52 percent from an early high of
98.89. The loonie-yen pair may find support around the 97.5 mark.
At yesterday's close, the pair was quoted at 98.64.
The loonie slipped to 1.2197 against the greenback, a level not
seen since May 1. The pair finished yesterday's deals at 1.2157.
The loonie is likely to challenge support near the 1.23 area.
Reversing from an early high of 0.9681 against the aussie, the
loonie edged down to 0.9723. The loonie is seen finding support
around the 0.98 level. The pair was valued at 0.9711 at Monday's
close.
On the flip side, the loonie held steady against the euro, after
rising to a 5-day high of 1.3578. The euro-loonie pair ended
Monday's trading at 1.3753.
Looking ahead, U.S. building permits and housing starts for
April are set to be published in the New York session.
Bretton Woods Committee 2015 Annual Meeting will be conducted in
Washington D.C. at 8:30 am ET, in which World Bank Managing
Director Sri Mulyani Indrawati, U.S. Treasury Secretary Jacob Lew
and International Monetary Fund head Christine Lagarde are to
deliver speeches.
At 11:30 am ET, Bank of Canada Governor Stephen Poloz will
address the Greater Charlottetown Area Chamber of Commerce in
Prince Edward Island, followed by a news conference.
Half-an-hour later, Swiss National Bank director Jean-Pierre
Danthine will deliver a speech titled "Swiss Monetary Policy Facts
and Fictions", in Geneva.
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