Canadian dollar, oil continue to slide
North American stock markets flat
The loonie fell for a third consecutive day while the price of oil continued its slide, as uncertainty around U.S. President Donald Trump kept North American stock markets relatively flat Tuesday.
The Canadian dollar shed 0.46 of a U.S. cent to 75.95 cents US. It has lost 0.85 of a U.S. cent over the past three trading days.
Most strategists on the currency side have been surprised with the loonie’s strength, said Scott Vali, vice president of equities and a portfolio manager at CIBC Global Asset Management.
Last week, the Canadian dollar was trading at its highest levels in nearly five months.
The commodity-sensitive loonie had been boosted by the price of oil, he said, rather than weakening on the strength of the greenback as some analysts have expected.
But the recent drop in oil prices has sent the loonie falling as well, said Vali.
The March crude contract was down 84 cents at US$52.17 per barrel, for a week’s loss of US$1.66 so far.
It’s “a bit of a seasonal pause,’’ says Vali, as oil prices typically experience a weaker period from February through to March.
During that time, demand for refined product is weaker and refiners typically shut down for annual maintenance, he said.
But as demand picks up between April and June, Vali expects prices will as well.