Canada’s currency may extend its biggest annual decline on record, as tumbling crude prices hobble foreign investment in the country’s oil patch, according to the world’s biggest strategists and economists.
The Canadian dollar fell 18 percent this year as a global recession cut demand for commodities, which generate half the country’s exports. Canada’s current-account surplus, the broadest measure of trade, will turn into deficit in 2009, said Toronto- based Scotia Capital Inc., a unit of Canada’s third-biggest bank.
“A scaling back of foreign direct investment is a negative for the Canadian dollar,” said Eric Lascelles, chief economics strategist in Toronto at TD Securities Inc., a unit of Canada’s second-largest bank. “If there is less investment in oil sands, there will be less production and less exporting down the road,” he said, referring to the world’s biggest energy pool outside Saudi Arabia.
Canada’s dollar, dubbed the “loonie” for the aquatic bird on the one-dollar coin, may weaken to C$1.28 by the end of the first quarter from C$1.2221 yesterday, according to the median estimate of 42 analysts and economists surveyed by Bloomberg. It may end 2009 at C$1.24, the poll’s results show. One Canadian dollar buys 82.24 U.S. cents.
Deutsche Bank AG of Frankfurt, the world’s biggest currency trader, forecasts the Canadian dollar will weaken to C$1.30 by the end of 2009, while Zurich-based UBS AG, the second-biggest trader, sees it depreciating to C$1.33.
Forex Bloomberg News.
The Canadian dollar fell 18 percent this year as a global recession cut demand for commodities, which generate half the country’s exports. Canada’s current-account surplus, the broadest measure of trade, will turn into deficit in 2009, said Toronto- based Scotia Capital Inc., a unit of Canada’s third-biggest bank.
“A scaling back of foreign direct investment is a negative for the Canadian dollar,” said Eric Lascelles, chief economics strategist in Toronto at TD Securities Inc., a unit of Canada’s second-largest bank. “If there is less investment in oil sands, there will be less production and less exporting down the road,” he said, referring to the world’s biggest energy pool outside Saudi Arabia.
Canada’s dollar, dubbed the “loonie” for the aquatic bird on the one-dollar coin, may weaken to C$1.28 by the end of the first quarter from C$1.2221 yesterday, according to the median estimate of 42 analysts and economists surveyed by Bloomberg. It may end 2009 at C$1.24, the poll’s results show. One Canadian dollar buys 82.24 U.S. cents.
Deutsche Bank AG of Frankfurt, the world’s biggest currency trader, forecasts the Canadian dollar will weaken to C$1.30 by the end of 2009, while Zurich-based UBS AG, the second-biggest trader, sees it depreciating to C$1.33.
Forex Bloomberg News.