Canada’s dollar touched the lowest level in three weeks as crude oil dropped and U.S. service industries grew at the slowest pace since February 2010, adding to concern Canada’s largest trading partner is faltering. Canada’s 30-year government bonds snapped six days of gains, with the yield earlier touching 3.14 percent, the lowest level in Bank of Canada records dating to 1970. The loonie pared losses as U.S. stocks advanced after dropping. “We see commodities down on this view that the U.S. economy is slowing,” said Gregory Salvaggio, senior vice president of capital markets in Washington at the currency trader Tempus Consulting Inc. “The Canadian dollar is ultimately going to suffer, and that’s exactly what we’re seeing happen today.” The Canadian currency fell 0.1 percent to 96.21 cents against the U.S. dollar at 5 p.m. in New York, compared with 96.13 yesterday, after touching 96.47, the weakest level since July 13. One Canadian dollar buys $1.0394. It rallied on July 26 to 94.07 cents, the strongest since November 2007. The 30-year government bond rose two basis points, or 0.02 percentage point, to 3.19 percent after falling earlier to the record low. The price of the 4 percent security maturing in June 2041 dropped 44 cents to C$115.59. U.S. Services The Institute for Supply Management’s non-manufacturing index for the U.S. fell to 52.7 in July from 53.3 in the previous month, the Tempe, Arizona-based group reported today. Readings above 50 signal expansion, and the median forecast of 75 economists in a Bloomberg News survey was for an increase to 53.5 last month. Futures on crude oil, Canada’s biggest export, dropped 2 percent to $91.90 a barrel, after touching 91.22 its lowest level in more than a month. The Thomson Reuters/Jefferies CRB index of raw materials fell 1.3 percent. “Signs of slowing in the U.S. and globally have put significant downward pressure on commodity prices, so look at the sell-off in crude oil today as another factor that’s driving the Canadian dollar to pare some of its recent gains,” said Omer Esiner, chief market analyst in Washington at Commonwealth Foreign Exchange Inc., a currency brokerage. The Standard & Poor’s 500 Index gained 0.5 percent after seven consecutive days of losses. The S&P/TSX Composite Index rose 0.5 percent after sliding 1.5 percent. Loonie Versus Franc Against the Swiss franc, the loonie gained 1 percent to 80.07 centimes after earlier rallying 2.5 percent. The Canadian dollar slid 0.2 percent to 80.10 yen. The franc tumbled earlier against all of its most-traded counterparts tracked by Bloomberg after the Swiss National Bank unexpectedly cut interest rates to weaken the currency and support Switzerland’s economy. The Swiss currency has soared 25 percent in the past 12 months, making it the best performer among 10 developed-nation peers including the loonie in Bloomberg Correlation-Weighted Currency Indexes. The Canadian dollar rose versus the greenback earlier today after ADP Employer Services reported that U.S. companies added 114,000 workers in July. The median forecast of 39 economists in a Bloomberg News survey was for an advance of 100,000. The Labor Department’s payrolls report on Aug. 5 is forecast to show an increase of 85,000 jobs. Canadian employers added a net 15,000 workers to payrolls in July, according to the median forecast of 26 economists in a Bloomberg News survey. Statistics Canada is due to release figures at 7 a.m. in Ottawa the day after tomorrow. To contact the reporters on this story: Joe Ragazzo in New York at jragazzo@bloomberg.net; Chris Fournier in Halifax at cfournier3@bloomberg.net To contact the editor responsible for this story: Dave Liedtka at dliedtka@bloomberg.net

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