Loonie dips on credit concerns
By John McCrank
TORONTO (Reuters) - The Canadian dollar fell a tad against the U.S. dollar on Tuesday, as credit concerns overshadowed record prices for oil, a key Canadian export.
Canadian bond prices dipped, along with the larger U.S. market.
At 9:30 a.m. EDT, the Canadian dollar was at C$1.0200 to the U.S. dollar, or 98.04 U.S. cents, down from C$1.0196 to the U.S. dollar, or 98.08 U.S. cents, at Monday's close.
The currency had risen as high as C$1.0165, or 98.38 U.S. cents, during the overseas session but was unable to maintain its momentum as credit fears dominated.
"There is still quite a bit of uncertainty out there, especially in the next couple of weeks where we are moving into the (U.S.) bank earnings window," said George Davis, chief technical strategist at RBC Capital Markets.
"People are very nervous that we are going to get some more sizable writedowns."
U.S. financial heavyweights Merrill Lynch MER.N and Citigroup (C.N: Quote) are due to report results later in the week. Analysts say both could announce billions of dollars of writedowns on bad debt.
On Monday, Wachovia, the fourth largest U.S. bank, announced a surprise first-quarter loss linked to credit problems and bad debt. Continued...