The Canadian currency fell against most of its major counterparts after Bank of Canada Governor Mark Carney reiterated to lawmakers yesterday that interest-rate increases are less urgent in the face of a slow economy.
Canada’s dollar was little changed against its U.S. peer after Bank of England Governor Mervyn King said currencies should be allowed to fluctuate on monetary-stimulus measures. Canadian employment unexpectedly fell last month and housing starts dropped to the lowest level since the end of the 2009 recession, reports showed last week.
“People could be paying more attention to Carney’s comment when he talked about considerable slack in the Canadian economy, and that’s having a bit more of an impact overnight,” said David Watt, chief economist at the Canadian unit of HSBC Holdings Plc, by phone from Toronto. “We also haven’t had any Canadian data to focus on. We had that big burst of data on Friday, and if you had a modestly positive view on the Canadian dollar before that day you’re probably somewhat more cautious now.”
The loonie, as the Canadian dollar is known for the image of the aquatic bird on the C$1 coin, traded at C$1.0028 per U.S. dollar at 8:17 a.m. in Toronto. One Canadian dollar buys 99.72 U.S. cents.
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