Loonie Plummets To Multi-day Lows Against Majors Amid Canadian Rate Decision
21 October 2009 - 4:21AM
RTTF2
The Canadian currency plunged sharply against major opponents
following the announcement of Bank Of Canada's interest rate
decision during New York morning trading on Tuesday.
The Bank Of Canada maintained its overnight rate target
unchanged at 0.25 percent in October. The BoC may be continue to
keep the rate unchanged for a long period unless the inflation
outlook changes.
Statistics Canada reported today that Canadian wholesale sales
fell by 1.4% in August after a 2.6% gain in the previous month.
Economists expected wholesale sales to rise 1% following a revised
2.6% increase in July.
The Stats Canada also said that Canadian leading indicators
index rose by 1.1% in September from August.
Extending previous session's downtrend, the loonie declined
further against its US counterpart in New York morning deals today.
At 11:35 am ET, the loonie dropped to an 11-day low of 1.0530
versus the greenback, compared to yesterday's close of 1.0286.
The U.S. Labor Department revealed that producer prices fell 0.6
percent in September. Economists were looking producer prices to
slip by 0.3 percent in the month. Core prices, which exclude the
volatile food and energy sectors, edged down by 0.1 percent for
September. Economists were looking for an advance of 0.1
percent.
The U.S. Commerce Department released a report today showing
that housing starts edged up 0.5 percent to an annual rate of
590,000 in September from the revised August estimate of 587,000.
Economists had expected starts to rise to 610,000 from the 598,000
originally reported for the previous month.
Additionally, the report showed that building permits, an
indicator of future housing demand, fell 1.2 percent to an annual
rate of 573,000 in September from the revised August rate of
580,000.
Against the euro, the loonie traded down sharply in today's New
York morning session and slipped to a 2-week low of 1.5686 at about
11:35 am ET. The pair was worth 1.5393 at yesterday's close. The
next downside target level for the Canadian currency is seen at
1.5748.
The Canadian dollar tumbled further against the Japanese yen in
morning deals and edged down to a new multi-day low of 86.35 by
about 10:20 am ET. The loonie-yen pair that closed Monday's New
York session at 88.09, is currently trading near 86.55.
The loonie also traded lower against the Australian dollar in
today's New York deals. At 11:00 am ET, the loonie slipped to a
fresh multi-month low of 0.9702 versus the yen, which may be
compared to yesterday's closing value of 0.9561.
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