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Monday, 28 September 2015 21:50
TORONTO: The Canadian dollar flirted with 11-year lows against its US counterpart on Monday as volatile crude oil prices took a negative turn, at one point falling more than 2 percent on worries over weak global demand.
The price of crude, a major Canadian export, has plunged by more than half in the last year, dragging the loonie along some 20 percent in that time.
At 9:56 a.m. EDT (1356 GMT), the Canadian dollar was trading at C$ 1.3335 to the greenback, or 74.99 US cents, softer than the Bank of Canada’s official close of C$ 1.3316, or 75.10 US cents.
The loonie traded between C$ 1.3319 and C$ 1.3379 so far on Monday. Last week, it briefly touched C$ 1.3417, or 74.53 US cents, its weakest level since June 2004.
Potentially market-moving reports on tap this week include Canadian gross domestic product figures for July, due out on Wednesday, and US labour data for September, on Friday.
US crude prices were down 1.95 percent at $ 44.81, while Brent crude lost 1.98 percent to $ 47.64.
Despite the Canadian dollar’s weakness against the greenback, the currency was stronger than most of its key counterparts. It is expected to trade between C$ 1.3315 and C$ 1.3400 against the US dollar on Monday, according to RBC Capital Markets.
Canadian government bond prices were higher across the maturity curve, with the two-year price up 2 Canadian cents to yield 0.532 percent and the benchmark 10-year rising 43 Canadian cents to yield 1.479 percent.
The Canada-US two-year bond spread was -16.1 basis points, while the 10-year spread was -65.3 basis points.
