Yesterday the Canadian Dollar dropped from a three-week high against the US Dollar as investors sought the safety of lower-risk assets in the wake of a proposal to impose a levy on Cypriot bank deposits. Today the commodity-driven currency has posted additional losses after disappointing Canadian data.
The Canadian Dollar Exchange Rate was in the region of 0.9763 against the US Dollar as of 14:12 pm GMT
Last week the ‘Loonie’ was able to record a weekly gain of 0.9 per cent against the ‘Greenback’, its first 5 day advance against its American cousin for over a month. However, the currency has since fallen back following concerning developments in the Eurozone and disappointing home-grown data.
Statistics Canada reported that for the first time in five months factory sales in the nation fell, dropping by 0.2 per cent, largely as a result of declines in aircraft and automobiles.
Economists had predicted a gain of 0.6 per cent.
As foreign exchange exec Don Mikolich observed: ‘A little bit of a negative number for Canada, and again we are trying to build on that good employment number by having some other positive economic data come out. So without that positive reinforcement over this week and next week, I think Canada will test the upper ends of the boundaries.’
Over in the US meanwhile, separate reports compiled by the Commerce Department revealed that US home construction increased last month while building permits jumped to an almost five-year high.
In recent weeks a string of positive economic data releases for the world’s largest economy have served to highlight the shortcomings of neighbouring Canada, leaving the ‘Loonie’ to trade below parity with its American counterpart since early January.
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