Canadian dollar hits new eight-month low as oil tumbles, investors buy greenbacks
By Fergal Smith
TORONTO (Reuters) - The Canadian dollar weakened to a fresh eight-month low against its U.S. counterpart on Friday as oil tumbled and as the greenback padded its gains since the U.S. election this week.
For the week, the loonie lost 1 percent.
U.S. crude oil futures CLc1 settled $1.25 lower at $43.41 a barrel after OPEC said October output reached another record, casting doubt on whether its plan to limit production is achievable or enough to ease persisting oversupply. [O/R]
"I think things will probably continue to be volatile, probably moving against the loonie in the short term" until OPEC resolves oversupply issues for oil, said Jeff Scott, senior corporate dealer at OFX.
Oil is one of Canada's major exports.
Investor demand for U.S. dollars to buy stocks, betting that policies from U.S. President-elect Donald Trump will be supportive of stock prices, has added to pressure on Canada's currency, Scott said.
The U.S. dollar .DXY gained ground against a basket of major currencies.
At 4:33 p.m. EDT (2133 GMT), the Canadian dollar CAD=D4 was trading at C$1.3538 to the greenback, or 73.87 U.S. cents, weaker than Thursday's close of C$1.3483, or 74.17 U.S. cents. Continued...