The Canadian dollar fell versus its US counterpart on Friday, touching a seven-week low as concerns over surging COVID-19 infections in Europe battered riskier currencies, but the loonie reversed some losses after better-than-expected retail sales numbers.
At 10 a.m. EST (1500 GMT), the Canadian dollar was trading 0.19% lower at 1.2625 to the greenback, or 79.21 US cents.
The loonie traded as low as 1.2662, its weakest since Oct. 1, but strengthened slightly after data showed retail sales declined 0.6% in September, which was ahead of the consensus forecast of a 1.7% drop. Retail sales are expected to have risen in October by 1%, the report said.
"The better-than-expected retail sales definitely gave it a boost," Eric Theoret, global macro strategist at Manulife Investment Management, said of the currency.
Canadian dollar slips as inflation data matches expectations
"But from my perspective, the Canadian dollar today is not trading on domestic fundamentals. Really, the big driver is just the broader developments in terms of the COVID situation and concerns about shutdowns in Europe," he said.
Austria said it will become the first country in western Europe to reimpose a full coronavirus lockdown to tackle a new wave of COVID-19 infections, and will require its whole population to get vaccinated as of February.
Germany, which is experiencing a fourth wave of infections, warned it may follow suit, sending shivers through financial markets worried about the economic fallout.
The price of oil, one of Canada's main exports, fell sharply on Friday toward $78 a barrel as the fresh surge in COVID-19 cases in Europe threatened to slow the economic recovery.
US crude prices were down 2.86% at $76.75 a barrel, while Brent crude lost 2.46% to $79.24.
Other commodity-linked currencies, including the Australian and New Zealand dollars, were also down as investors fled to the save-haven US dollar.
Comments
Comments are closed.