TORONTO (Reuters) - Bank of Canada Governor David Dodge said on Thursday the drop in the Canadian dollar during the past month has put it back in a range the bank thought made sense in its economic forecasts.
Since hitting a modern-day high of US$1.1039 on November 7, the Canadian dollar has fallen about 11 percent and is much closer to the central bank’s 98 U.S. cent level assumed in its recent economic forecasts.
At 11:30 a.m. (1630 GMT), the Canadian dollar was at 98.57 U.S. cents, valuing a U.S. dollar at C$1.0145.
The rapid rise in the Canadian dollar was supported by a slew of factors that included robust domestic economic data, lofty commodity prices and a generally weaker U.S. currency.
But a drop in oil prices from record levels, a sudden wave of softer domestic data and a Bank of Canada rate cut this week have yanked the currency back below parity with the greenback.
Dodge, along with Bank of Canada Deputy Governor Paul Jenkins, made his comments to the Standing Senate Committee on Banking, Trade and Commerce.
Reporting by Frank Pingue; Editing by Rob Wilson