SF: Canada's Dollar Declines From 3-Week High Amid Rate Speculation
July 14 (Bloomberg) -- Canada's dollar weakened from a three-week high versus its U.S. counterpart as traders pared wagers on further gains before the nation's central bank meets next week to determine interest rates.
The currency was the third-best performer among the greenback's 16 most-traded counterparts last week, rising 2.8 percent on speculation higher borrowing costs weren't fully reflected in the price. Crude oil, Canada's biggest export, dropped 0.7 percent today.
"We are now getting into an area of consolidation ahead of next week's Bank of Canada meeting," Michael Leavitt, a Montreal-based institutional-derivatives broker at MF Global Holdings Ltd., said in an e-mail. "Look for a tighter range in the Canadian dollar for the short term after this recent run up."
The Canadian currency fell 0.4 percent to C$1.0355 per U.S. dollar at 8:03 a.m. in Toronto, compared with C$1.03 yesterday. The loonie, as the currency is nicknamed for the waterfowl on the C$1 coin, touched C$1.0277 yesterday, the most since June 23. One Canadian dollar buys 96.57 U.S. cents.
Bank of Canada Governor Mark Carney lifted the policy rate June 1 to 0.5 percent and said future moves would depend on the pace of growth in Canada weighed against signs of an uneven global recovery. Policy makers next meet July 20.
