The Canadian dollar continues to fall, thanks to recent weakness in oil prices, a rising US dollar and weak Canadian economic data. Last Friday, economic growth figures missed expectations, with month-over-month growth for July coming in at 0%, vs. expectations of 0.1%. Looking at crude oil, prices fell sharply yesterday although WTI remains above $50 for now. Previously in September, the loonie fell following comments from Bank of Canada Governor Poloz suggesting that future interest rate hikes are less certain in the future.
USD/CAD was able to climb above 1.25 yesterday, and is currently trading above 1.2520. The Canadian dollar remains flat against the euro, as both currencies weaken at the same pace. EUR/CAD is currently trading near 1.4680. Finally, the currency is also flat against the pound, with GBP/CAD above 1.660.
This week's economic data includes manufacturing PMI data (released yesterday), merchandise trade balances on Thursday and unemployment data on Friday. Manufacturing PMIs released yesterday were stronger than the previous release (55 vs. 54.6 prior). Unemployment data will be watched closely as the market debates the odds of future interest rate hikes by the Bank of Canada.