Cana­dian dol­lar plunges to post-re­ces­sion low af­ter cen­tral bank cuts key rate

Cape Breton Post - - CLASSIFIEDS /BUSINESS -

TORONTO - The Cana­dian dol­lar fell to its low­est level in more than six years on Wed­nes­day af­ter the Bank of Canada cut its key in­ter­est rate and low­ered its forecast for the econ­omy. The loonie ended the day at 77.40 cents US, down 1.09 cents from the pre­vi­ous day's close, a level not seen since March 2009 when Canada was in the midst of a deep re­ces­sion. Stephen Car­line, man­ag­ing di­rec­tor and head of eq­ui­ties at CIBC As­set Man­age- ment, said the move wasn't en­tirely un­ex­pected, although some mar­ket watch­ers had ex­pected rates to re­main flat. The dol­lar's slide, he said, mir­rored the one fol­low­ing Jan­uary's rate cut. The Bank of Canada cut its key in­ter­est rate by a quar­ter of a per­cent­age point to 0.5 per cent on Wed­nes­day, slashed its out­look for the econ­omy and pre­dicted a con­trac­tion in the sec­ond quar­ter due to lower oil prices and slump­ing ex­ports. In a speech in Washington, Fed­eral Re­serve chair­woman Janet Yellen said that the Amer­i­can cen­tral bank is likely to raise its own bench­mark in­ter­est rates this year if the U.S. econ­omy con­tin­ues to im­prove.

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