Canadian dollar weakens with crude oil, hits new 11-year low

Mon Dec 7, 2015 9:50am EST
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TORONTO (Reuters) - The Canadian dollar hit its weakest level in more than 11 years on Monday, pressured by further slippage in crude oil and the likely start of U.S. Federal Reserve tightening next week.

Oil prices edged closer to 2015 lows after the Organization of the Petroleum Exporting Countries (OPEC) ended its policy meeting on Friday without agreeing to lower production.

U.S. crude CLc1 prices were down 3.35 percent to $38.63 a barrel, while Brent crude LCOc1 lost 2.65 percent to $41.86.[O/R]

On Friday, Canadian data suggested the economy was off to a weak start in the final quarter of 2015 after just recently emerging from a mild recession.

Speculators added slightly to bearish bets on the Canadian dollar, according to Reuters calculations and data from the Commodity Futures Trading Commission released on Friday.

Net short exposure rose to -38,980 contracts, as of Dec 1, 2015, from -38,617 contracts in the prior week.

At 9:21 a.m. EST (1421 GMT), the Canadian dollar CAD=D4 was trading at C$1.3486 to the greenback, or 74.15 U.S. cents, much weaker than the Bank of Canada's official close on Friday of C$1.3377, or 74.76 U.S. cents.

The currency's strongest level of the session was C$1.3363, while its weakest level was C$1.3492.

That was its weakest level since mid-2004.   Continued...

Canadian Loonies, otherwise known as a one dollar coin, are displayed on top of an American currency in this posed photograph in Toronto, October 10, 2008.  REUTERS/Mark Blinch