The Canadian dollar fell against its US counterpart and the Japanese yen as the threat of Greece exiting the eurozone weighed on commodity currencies. On the other hand, the loonie gained versus the euro.
Canada is lucky to have the United States as its largest trading partner, not the European Union as many other export-oriented countries. The US economy has its share of problems, but it stays firmly on a trek to recovery, while the EU is in recession. Combined with positive fundamentals in Canada itself, including the favorable employment data last week, it does not look surprising that Canada’s currency managed to outperform the euro as well as some commodity currencies.
The performance of the loonie against safer currencies is a totally different matter. The EU is a huge importing market and its woes are reflected on all growth-related countries. Canada is not excluded from the list, even though its trading ties with the USA help it weather the European crisis with less difficulty.
USD/CAD fell climbed from 1.0001 to 1.0024 and CAD/JPY fell from 79.93 to 79.63 as of 20:10 GMT today. At the same time, EUR/CAD went down from 1.2901 to 1.2865, reaching 1.2857 intraday — the lowest level since January 2011. AUD/CAD slid from 1.0012 to 0.9989 — the lowest price since October 2011.
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