Canadian Dollar Falls As Oil Prices Decline
January 29 2015 - 6:18AM
RTTF2
The Canadian dollar declined against its major rivals in
European deals on Thursday, as oil prices continued their sell-off
on concerns over a supply glut following a data showing uptick in
U.S. crude oil inventories last week.
Crude oil for March delivery fell by $0.10 to $44.35 per
barrel.
Weekly report from the U.S. Energy Information Administration
showed Wednesday that U.S. crude oil inventories advanced by 8.9
million barrels in the week ended January 23, while analysts
expected an increase of 3.5 million barrels. As a result, U.S.
crude oil inventories surged to 406.7 million barrels end last
week.
The American Petroleum Institute late Tuesday said crude oil
supplies in the U.S. rose 13 million barrels last week.
The currency was also hurt by decline in European stocks. The
U.S. Federal Reserve indicated that it is on track to raise
short-term interest rates later this year, despite weakness in oil
prices and inflation expectations.
Investors are also concerned about Syriza's pledge to
renegotiate the terms of Greece's €240 billion international
bailout.
The loonie weakened to 1.2562 against the greenback, its lowest
since March 2009, from yesterday's closing value of 1.2534. The
next possible support for the loonie is seen around the 1.264
zone.
The loonie that ended yesterday's trading at 1.4147 against the
euro slipped to a weekly low of 1.4222. Next key support for the
loonie is seen around the 1.43 area.
Survey data from the European Commission showed that the
economic confidence index climbed to 101.2, the highest since July,
from 100.6 in December. It was forecast to rise to 101.6. The
loonie held in lower ranges against the yen, trading at 93.91.
Continuation of the loonie's downtrend may lead it to a support
around the 92.00 region.
Retail sales in Japan rose 0.2 percent on year to 13.524
trillion yen in December, the data from Ministry of Economy, Trade
and Industry showed.
That missed forecasts for an increase of 0.9 percent and was
down from the 0.5 percent gain in November.
On the flip side, the loonie strengthened to a 2-week high of
0.9763 against the aussie. At yesterday's close, the pair was
valued at 0.9883. The loonie may challenge resistance surrounding
the 0.97 mark.
Looking ahead, preliminary German CPI for January, U.S. pending
home sales data for December and U.S. weekly jobless claims for the
week ended January 24 are scheduled for release in the New York
session.
At 11:30 am ET, European Central Bank Executive Board member
Benoit Coeure will take part in a panel discussion on "The future
of Euro" organized by the Innocenzo Gasparini Institute for
Economic Research and Centre for Applied Research at Bocconi
University in Milan, Italy.
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