Forex

Canadian dollar ends at 4-week low amid oil plunge and fears on NAFTA crush out

Canadian dollar

The Canadian dollar extended its losing streak against its US counterpart to three days as it closed down on Thursday and tumbled to its lowest finish in more than four weeks, with low oil prices and concerns over the termination of North American Free Trade agreement weighing in.

The Lonnie tallied its third straight decline this week as it shed 0.12% of its strength yesterday to settle at 1.2902 per dollar or 77.51 US cents, the currency’s weakest close since November 1.

The sustained loss on Canadian dollar was brought by major market movers that hounded Canada in the past few days. The prices of oil, the country’s major exports, has returned to the bearish zone after Organization of Petroleum Exporting Countries revealed its decision regarding the output cut.

The members and allies of OPEC have decided to push the 10-month extension of the production curb to pump up oil prices but Russia reiterated that the country will withdraw from the deal once the market overheats.

Meanwhile, investors feared that the termination of the NAFTA, which President Donald Trump has threatened, might cause further damage to the Canadian dollar. According to analysts, the Lonnie could swing down to 72.5 per US cents once the agreement is extinguished.

Also, the overall Canadian economy could trim down 1% on the NAFTA crush out, based on the latest research done by Bank of Montreal.

In the previous quarter, the country’s account deficit has ballooned to its third largest total in the history after reaching C$19.35 billion.

Please follow and like us:

Leave a Reply

Your email address will not be published. Required fields are marked *