Loonies are pictured in Vancouver, Sept. 22, 2011. THE CANADIAN PRESS/Jonathan Hayward
January 13, 2014 - 5:45 AM
TORONTO - The Canadian dollar continued to head lower Monday in the wake of a major employment disappointment at the end of last week.
The loonie declined 0.09 of a cent to 91.64 cents US on top of a slide of almost 1/2 a cent on Friday after Statistics Canada reported the economy shed 46,000 jobs last month.
Markets also dealt with a big jobs disappointment in the U.S. on Friday, where only 74,000 jobs were created during December. That missed estimates for at least 200,000 jobs and raised speculation about how quickly the Federal Reserve may move to end its key stimulus program, the massive monthly bond purchases.
The Fed moved last month to cut those purchases by US$10 billion to $75 billion a month and said further tapering was contingent on economic strength, particularly in the employment sector.
The loonie last week hits its lowest levels since September, 2009.
However, the Canadian dollar started sliding well before the employment data came out as speculation about Fed tapering has pushed the U.S. dollar higher.
The loonie has also been pressured recently by a dovish stance on interest rates by the Bank of Canada, data showing a growing trade deficit and lower U.S. imports — including oil.
"To date, Canada's oil exports to the U.S. have continued to trend higher, however there is uncertainty over the path from here as well as how Canada will ultimately transport oil," observed Camilla Sutton, chief foreign exchange strategist at Scotiabank.
"Markets do not like uncertainty, particularly when the risk is negative. This is a Canadian dollar negative over the next six-months."
Commodity prices were lower across the board Monday morning with February crude on the New York Mercantile Exchange down 52 cents to US$92.20 a barrel.
March copper dipped two cents to US$3.32 a pound while February bullion edged 20 cents lower to US$1,246.70 an ounce.
News from © The Canadian Press, 2014