RTTN: Canadian Dollar Plummets To Fresh Multi-week Low Against Greenback
(RTTNews) - Canada's dollar depreciated in early New York trading on Monday as the price of oil, one of the nation's key exports whose price often dictates the currency's direction, is heading to dip below $74 a barrel. The resource-linked loonie slumped to a new multi-week low against the US dollar and a multi-day low versus the euro.
The price of crude oil is heading to break below the $74-mark in morning deals amid lack of positive triggers. Poor outlook on demand and fears that China may boost efforts to curb credit flows to check its overheating economy dampened traders' sentiment.
Traders also fear that less money will flow into commodity markets after President Barack Obama proposed tougher bank regulations. As of 9:00 am ET, Light Sweet Crude Oil futures for March delivery were at a one month low of $74.25, down $0.29, a barrel. On Friday, the contract fell $1.54 to settle at $74.54 a barrel, the lowest since December 22.
The Canadian dollar reached a 12-day low of 1.5008 against the common unit of Europe by 9:05 pm ET and the pair moved on hold thereafter. On the downside, the loonie may test the 1.51 support level. The euro-loonie pair, which finished Friday's deals at 1.4969, is presently trading near 1.50.
German consumer confidence declined for a fourth straight month in February to 3.2 points from a revised reading of 3.4 points in January. Economists had forecast a reading of 3.3 points.
The Eurozone statistical office Eurostat revised industrial new orders data after Germany's Federal Ministry of Economics and Technology revised the country's new order data on January 22 to show better growth figures.
According to the revised report, Eurozone industrial new orders rose 2.7% month-on-month in November after a revised fall of 2.1% in October. The most striking improvement was the slowdown in annual decline to just 0.5% from October's 14.5% fall.
Against the Japanese yen, the Canadian dollar declined to 85.04 around 9:25 am ET and moving a few pips down may bring the pair to its lowest mark in nearly 5 weeks. The loonie-yen pair is presently worth 85.20, compared to 84.91 hit late New York Friday.
The Canadian dollar reached at 1.0614 against the greenback by 9:30 am ET, the lowest level since December 22, 2009. The greenback-loonie pair, which finished Friday's trading higher at 1.059, is presently worth 1.0604 with 1.0740 seen as the next target level.
Across the boarder, traders will focus on a report on existing home sales for December slated to be released at 10.00 AM ET by the National Association of Realtors. Economists expect existing home sales to come in at 5.90 million for the month.
