By Commodity News Service Canada
WINNIPEG, July 6 – The Canadian dollar fell sharply against the US dollar Monday, dropping below 79 cents US during the trading session, but settling just above the key level.
Much of the selling was linked to traders shedding risky assets after Greece voted ‘no’ to international monetary aid on Sunday, analysts said.
The Canadian dollar closed at US$0.7904 or US$1=C$1.2652 on Monday, which compares with Friday’s North American settlement of US$0.7962 or US$1=C$1.2560.
The decline was also linked to a sharp sell-off in crude oil values, as it is one of Canada’s biggest exports. Crude oil was down nearly eight per cent Monday.
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However, some positive economic news out of Canada limited the downside. The Ivey Purchasing Managers Index remained above 50 in June, which is a good sign for the economy, industry watchers say.
Canadian bonds closed higher on Monday, as traders flocked to safe-haven assets, including government bonds, amid the economic turmoil in Greece, brokers said.
The two-year bond yielded 0.460% Monday, from 0.481% Friday. The 10-year bond yield was at 1.631%, from 1.699%. Bond yields fall as their prices rise.
