Canadian Dollar Hit By Higher USD, Lower Oil

The Canadian Dollar (CAD) extended its losses against the US Dollar (USD) today as investors remained strongly worried over the European debt crisis and continued to switch to safer currencies. The CAD was also hit hard by sharply declining oil prices as a result of higher US oil inventories and fears of lower demand in the near-term. Light crude oil (NYMEX:CLC1) shed more than $3 today, dropping below $80 a barrel for the first time since February. As a result, the CAD, being one of the major commodity currencies, dropped as well, especially against the safer USD and Japanese Yen (JPY).

The USD/CAD pair continued to rally, reaching to 1.0353, a level last seen on March 3. The pair gave back some of the gains later, and is now trading just above 1.03, still a significantly higher level than this week’s open of 1.0173. The Canadian currency dropped against its Japanese counterpart as well, as the CAD/JPY fell from 92.64 all the way to 90.63 and is currently trying to pull back above 91.