BLBG:Canadian Dollar Drops On Speculation European Crisis Deepening
Canada’s dollar weakened against its U.S. counterpart on speculation Europe’s debt crisis is worsening as Spanish bond yields rose above 7.5 percent for the first time, dimming the outlook for the global economy.
Canada’s currency, which tends to appreciate on prospects for its commodity exports, dropped against a majority of its most-traded peers as crude oil fell more than $3 a barrel. Canadian 10-year bond yields reached a record low as investors fled to the safety of government assets.
“The pressure on Spain remains immense,” Boris Schlossberg, managing director of foreign exchange at BK Asset Management, an investment advisory firm in New York, said in a phone interview. “If you’re a longer-term trader, you remain short.” A short position is a bet that a currency, in this case the euro, will drop in value.
Canada’s currency, nicknamed the loonie, declined 0.4 percent to C$1.0170 cents per U.S. dollar at 7:56 a.m. in Toronto. It rose to a record high C$1.2273 versus the euro. One Canadian dollar buys 98.33 U.S. cents.
To contact the reporter on this story: Chris Fournier in Halifax at cfournier3@bloomberg.net
To contact the editor responsible for this story: Robert Burgess at bburgess@bloomberg.net
