Canadian Dollar Declines, As Economic Concerns Mount And Oil Prices Drop
THE CANADIAN PRESS -- TORONTO - The Canadian dollar declined Thursday, falling for a second day with the currency pressured by low oil prices and further indications of a weakening economy in the U.S., which is Canada's biggest trading partner.
The loonie lost 0.46 of a cent to 102.03 cents US on top of a slide of three quarters of a US cent on Wednesday.
Markets were nervous a day before the release of the U.S. non-farm payrolls report for May on Friday after the ADP payrolls firm said Wednesday that private sector employers only added 38,000 jobs during the month, far lower than the 175,000 expected in the markets.
Economists had expected that the government would report that the economy created 190,000 jobs during the month but many are sharply revising that estimate downward.
Also, a weak manufacturing report from the Institute for Supply Management showed the sector still expanding, but at a much slower pace.
Oil prices moved into negative territory with the July contract on the New York Mercantile Exchange down $1.46 to US$98.83 a barrel after the U.S. Energy Department said crude inventories rose 2.8 million barrels last week against expectations of a decline of 1.6 million barrels.
The data added to demand concerns which sent oil tumbling $2.41 a barrel on Wednesday.
Base metal prices were also lower with the July copper contract down six cents at US$4.05 a pound. The drop followed a decline of seven cents Wednesday following a sharp drop in China's main purchasing managers index. China is the world's biggest consumer of the metal.
Precious metal prices also moved lower with the August gold contract in New York down $20.20 to US$1,523 an ounce.