Canada Dollar Touches Weakest Since August Before Policy Meeting

Canada Dollar Touches Weakest Since August Before Policy Meeting

The Canadian dollar touched the lowest level against its U.S. counterpart in more than 10 weeks amid speculation the Bank of Canada will put less emphasis at a policy meeting tomorrow on raising interest rates.
The loonie, as the currency is nicknamed for the image of an aquatic bird on the C$1 coin, fell versus a majority of its most-traded peers. Central-bank Governor Mark Carney suggested in an Oct. 15 speech that tomorrow’s economic forecast will reflect a slow global recovery. Canada rejected on Oct. 19 a C$5.2 billion ($5.23 billion) bid by Petroliam Nasional Bhd. for Calgary-based Progress Energy Resources Corp. (PRQ)
“The statement may focus a little bit more on uncertainty from slower growth abroad,” Sireen Harajli, a foreign-exchange strategist in New York at Credit Agricole Corporate & Investment Bank, said in a telephone interview. “Even though it may face some short-term weakness, longer term we expect the Canadian dollar to strengthen given its relatively better growth rates and proximity to the U.S.”
Canada’s currency gained 0.1 percent to 99.22 cents per U.S. dollar at 5 p.m. in Toronto. The loonie touched 99.65 cents earlier, its weakest level since Aug. 10. One Canadian dollar buys $1.0077.
The loonie weakened as oil, the nation’s biggest export, fell. Crude-oil futures tumbled as much as 2.1 percent to $88.20 per barrel in New York, the lowest level in more than two weeks.
Canadian government bonds declined, pushing the yield on the 10-year benchmark note up three basis points, or 0.03 percentage point, to 1.87 percent. The price of the 2.75 percent securities maturing in June 2022 fell 26 cents to C$107.72.