The mood in global markets is sour, with growing worries about the euro-zone in particular. Stocks markets are falling and so are oil prices, which are hovering over the lows. The small group of winners in these moves are bonds, the dollar and the yen, which is the big winner. The Canadian dollar and its commodity currency peers are in the wide losing camp.
USD/CAD is gradually pushing higher, reaching 1.1250. The pair is now less than 20 pips below the high of 1.1270 seen after the strong US Non-Farm Payrolls, and less than 30 pips from 1.1280 which was seen beforehand and is the highest since 2009.
Oil prices have fallen 20% since June. The Saudis seem to want to push oil prices lower for a variety of reasons. Even though Canadian oil is more dependent on demand on its side of the globe and has its own reasons to rise or fall, the different prices of oil are not detached from one another.
The Canadian dollar managed to recover very nicely thanks to the big dollar correction and the excellent Canadian jobs data. However, it seems that the current market gloom and stock market rout could certainly push the Canadian dollar to a new post crisis low.
For more, see the Canadian dollar prediction.
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