Canadian Dollar Weakens On Falling Oil Prices
January 23 2017 - 4:21AM
RTTF2
The Canadian dollar slipped against its major counterparts in
the European session on Monday, as oil prices declined on
speculation that U.S. production will surge in 2017.
Crude for March delivery fell $0.73 to $52.49 per barrel.
U.S. energy companies last week added the most oil rigs in
nearly four years, Baker Hughes said Friday.
Data from energy services firm showed that the US oil-rig count
increased by 29 to 551 last week. The data raised worries over the
possibility of higher oil production in the U.S., which could
derail attempts by the other major oil producers to stabilize oil
market.
Sentiment was dampened on worries over the U.S. president Donald
Trump's adoption of protectionist stance over the weekend, vowing
the renegotiate NAFTA.
Trump said he has scheduled meetings with Mexican President
Enrique Pena Nieto and Canadian Prime Minister Justin Trudeau to
start reworking the trade deal.
"We're going to start renegotiating on NAFTA, on immigration and
on security at the border," Trump said at the start of a
swearing-in ceremony for top White House staff on Sunday. "I think
we're going to have a very good result for Mexico, for the United
States, for everybody involved. It's really very important." Data
from Statistics Canada showed that Canadian wholesale sales grew a
seasonally adjusted 0.2 percent on month in November.
This is slightly slower than the expected 0.3 percent growth and
follows a 1.3 percent surge in October.
The loonie showed mixed performance in the Asian session. While
the loonie rose against the aussie and the greenback, it held
steady against the euro. Against the yen, it dropped.
The loonie declined to 85.12 against the yen, its lowest since
December 5. The loonie-yen pair is likely to find support around
the 84.00 mark.
Figures from the Ministry of Economy, Trade and Industry showed
that Japan's all industry activity increased at a
slower-than-expected pace in November.
The all industry activity index rose a seasonally adjusted 0.3
percent month-over-month in November, after remaining flat in the
previous month. That was just below the 0.4 percent gain expected
by economists.
The loonie retreated to 1.3320 against the greenback and 1.0090
against the aussie, from its early 4-day highs of 1.3268 and
1.0027, respectively. Continuation of the loonie's downtrend may
see it challenging support around 1.34 versus the greenback and
1.02 versus the aussie.
The loonie resumed its decline versus the euro, falling to
nearly 4-week low of 1.4294. Further downtrend may take the loonie
to a support around the 1.44 region.
Looking ahead, at 10:00 am ET, Eurozone consumer confidence for
January is slated for release.
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