Canadian Dollar Extends Fall As Oil Prices Continue To Retreat
August 03 2015 - 2:07AM
RTTF2
The Canadian dollar was weaker against the other major
currencies in the Asian session on Monday, as oil prices extended
their slide on supply glut fears, driven by rising rig counts in
the U.S. and concerns of a slowing Chinese economy denting demand
growth.
Crude oil for September delivery are currently down $0.30 at
$46.82 a barrel.
Production of the Organization of the Petroleum Exporting
Countries (OPEC) nations rose to record levels in July. The
Secretary-general of the OPEC said Friday, the group would not cut
output in response to lower prices.
Iranian oil Minister Bijan Zanganeh said the nation seeks to
raise output by 500,000 barrels per day, as soon as sanctions are
lifted.
Meanwhile, most Asian stock markets were lower as the decline in
commodity prices, negative cues from Wall Street and weak Chinese
manufacturing data dampened investor sentiment. The final reading
for the Caixin China purchasing managers' index or PMI for July
dropped to a two-year low of 47.8 and also declined from the
preliminary reading of 48.2. The data raises fresh concerns about a
slowdown in the world's second-largest economy.
Friday, the Canadian dollar fell 0.36 percent against the U.S.
dollar, 0.89 percent against the yen, 1.43 percent against the euro
and 0.81 percent against the Australian dollar.
In the Asian trading today, the Canadian dollar fell to an
11-year low of 1.3132 against the U.S. dollar, from Friday's
closing value of 1.3085. If the loonie extends its downtrend, it is
likely to find support around the 1.33 area.
Against the Australian dollar and the yen, the loonie dropped to
nearly a 2-week low of 0.9591 and a 6-day low of 94.44 from last
week's closing quotes of 0.9554 and 94.59, respectively. The loonie
may test support near 0.96 against the aussie and 93.00 against the
yen.
The loonie edged down to 1.4411 against the euro, from Friday's
closing value of 1.4370. On the downside, 1.45 is seen as the next
support level for the loonie.
Looking ahead, PMI reports for July from major European
economies are due to be released in the European session.
In the New York session, U.S. personal income and spending data
for June, construction spending for June and manufacturing PMI
reports for July are slated for release.
At 9:00 am ET Federal Reserve Board Governor Jerome Powell is
expected to speak on "The Structure and Liquidity of Treasury Bond
Markets" in a Brookings Institution Conference in Washington D.C,
U.S.
Canadian banks will be closed in observance of Civic Day
holiday.
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