Very little about the Canadian dollar is being driven by what’s happening in Canada today. Instead, the loonie is responding to everything that’s going on in other countries. Fed bets and concerns about the Middle East are weighing on the Canadian dollar right now.
US durable goods orders are changing the view of what the Federal Reserve will do about tapering its bond purchase program. Durable goods orders fell more than expected, and that, along with continued emerging market troubles, sent cash flowing to reserve assets. Even though the loonie was granted reserve status earlier this year, it’s still not a major reserve currency when traders are more comfortable with currencies like the dollar, yen, and euro.
Also not helping the loonie is the troubles with Syria and the broader Middle East. Canadian dollar is getting hit by risk aversion as traders look for safer currencies. Even the higher oil prices resulting from the troubles in the Middle East aren’t supporting the loonie very well right now.
While most of the focus is outside Canada, when the focus does turn inward, there’s still concern about the economy and a potential housing bubble.
At 14:49 GMT USD/CAD is up to 1.0507 from the open at 1.0501. EUR/CAD is up to 1.4066 from the open at 1.4037. GBP/CAD is down to 1.6313 from the open at 1.6357.
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