C$ firms against greenback, but lags euro, Aussie

Tue Dec 22, 2015 4:59pm EST
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By Fergal Smith

TORONTO (Reuters) - The Canadian dollar firmed against its U.S. counterpart on Tuesday, supported by higher U.S. crude oil prices, although it lagged some other units in holiday-thinned trading.

U.S. crude CLc1 prices settled at $36.14 a barrel, up 0.9 percent, but Brent crude LCOc1 lost 0.36 percent to $36.22 as the two benchmarks moved into parity for the first time since January of this year.[O/R]

Repatriation flows were influential in light activity, according to Jack Spitz, managing director of foreign exchange at National Bank Financial, referring to trades where foreign subsidiaries covert currency to the currency of the parent.

"It's been light flow, fairly low liquidity, desks are not fully staffed and positions are being squared," said Spitz.

The Canadian dollar closed at C$1.3937 to the greenback, or 71.75 U.S. cents, stronger than Monday's close of C$1.3965, or 71.61 U.S. cents.

The currency's strongest level of the session was C$1.3917, while its weakest level was C$1.3965.

It touched a more than 11-year low of C$1.4003 on Friday.

"There's little reason to believe that USD-CAD isn't going to take another run at 1.40," said Spitz, although adding that interest remains to sell at that psychological threshold.   Continued...

A Canadian dollar coin, commonly known as the "Loonie", is pictured in this illustration picture taken in Toronto January 23, 2015. REUTERS/Mark Blinch