RTTN: Canadian Dollar Slides To 6-day Low Against Euro
(RTTNews) - The Canadian dollar slumped to a 6-day low against the European currency in early New York trading on Monday despite a rally in oil prices. Traders reacted negatively to the Statistics Canada report showing overall Canadian building permits fell sharply in November.
Contractors took out $5.9 billion in building permits in November, down 4.6% from October, but 23.1% higher than November 2008 and 62.8% above February 2009, when the lowest value during the economic downturn was recorded. However, November's value remained below values recorded in 2007 and early 2008.
Earlier, the Canada Mortgage and Housing Corporation reported that housing starts in December rose to 174,500, the highest since October 2008. Economists were expecting the housing starts to edge up by 161,800.
The price of crude oil hovered near the $84-mark on Monday, after China said Sunday that its oil imports rose 14% last year to a record high in December and on a weakening U.S. dollar. Light Sweet Crude Oil for February delivery rose $83.95 on the New York Mercantile Exchange, up $1.19 a barrel.
China said its exports jumped nearly 18% in December after declining for 13 months, an indication that global economic recovery is underway. On the other hand, China's trade surplus shrank by over 34% in 2009, reflecting its strong demand for imported raw-materials and consumer goods.
The Canadian dollar slumped to a 6-day low of 1.4974 against the common currency around 9:10 am ET, down by more than 1.5 percent from last week's fresh 15-month high of 1.474. If the loonie declines further, support is likely to be seen around the 1.465 level. The euro-loonie pair that closed Friday's deals at 1.485 is currently quoted at 1.496.
The Canadian dollar that drifted higher to 90.15 against the Japanese yen in early trading started reversing its course in early New York. The loonie declined to 89.71 against the yen before leveling off around 9:15 am ET. The loonie-yen pair is presently worth 89.76, compared to 89.97 hit late New York Friday.
Against its US counterpart, the Canadian dollar reversed its direction after appreciating its strongest level in nearly 3 months. The loonie that jumped to 1.0255 against the greenback in the Asian session, the highest mark since Mid-October, 2009, pulled back and hit a low of 1.0321 around 9:25 am ET. The greenback-loonie pair, which finished Friday's trading at 1.0302, is presently quoted at 1.032.
With no first-tier economic data to consider, traders might take positive cues from corporate earnings, which could give an indication of the health of the broader economy. Keeping with tradition, aluminum major Alcoa Inc.(AA) will unofficially kick-start the earnings season for the fourth quarter with its results after the market closes for trading.
