The Canadian dollar fell to its weakest level against the US dollar since May 2007 on Monday as fears of more fallout from the global financial crisis froze money markets, putting a premium on the greenback and undercutting support for commodities.
Bond prices rose as investors looked for a safe place to park their cash in response to huge losses on the stock markets. The Canadian dollar closed the North American session at C$1.0992 to the US dollar, or 90.98 cents, down from C$1.0815 to the US dollar, or 92.46 US cents, at Friday's close.
The currency fell 1.6 percent against its US counterpart after dropping 4.5 percent last week, mostly in response to a stronger US dollar. "Everything is getting clobbered by the US dollar," said David Watt, senior currency strategist at RBC Capital Markets.