By Commodity News Service Canada
WINNIPEG, Dec. 3 – The Canadian dollar closed lower against the US dollar Tuesday, continuing a recent downward trend that has seen the currency lose more than a cent against its US counterpart over the last week.
The Canadian currency was quoted at US$0.9391 or US$1=C$1.0649 at the close on Tuesday, which compares with Monday’s North American settlement of US$0.9398 or US$=C$1.0641.
Some of the Canadian dollar’s weakness was linked to nervousness heading into Wednesday’s Bank of Canada (BoC) policy meeting. Traders are worried that the BoC will take an even more dovish stance on the Canadian economy, analysts said.
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Concerns that the US Federal Reserve will cut stimulus programs soon added to the bearish tone, as did weakness in gold and copper prices.
However, spillover support from the advances seen in crude oil values, Canada’s largest export, helped to limit the downside.
Canadian bonds moved higher ahead of Wednesday’s BoC announcement as they followed along with the US Treasury market, brokers said.
The two-year bond yielded 1.070% late Tuesday, from 1.107% late Monday. The 10-year bond yielded 2.563%, from 2.607%. Bond yields fall as their prices rise.
