TORONTO — The Canadian dollar closed lower Monday after a surprise announcement that Bank of Canada governor Mark Carney is leaving the central bank's top job next year to take over the top job at the Bank of England.
The loonie declined 0.19 of a cent to 100.62 cents US on the realization that Carney's departure doesn't change the near-term outlook for interest rates.
During an appearance before the Commons Finance Committee Oct. 31, Carney suggested that interest rates will rise before the end of 2014. Its key rate has been at one per cent for a little over two years.
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Canada losing Bank of Canada governor Mark Carney to the Bank of England is a huge loss for our country.
George Osborne appoints Mark Carney to become the Governor of The Bank of England. Canada has done well under his stewardship.
Mark Carney sounds like a good choice as next #BoE Governor and he has in addition the great advantage of not being Adair Turner.
Good luck to Mark Carney as the new BoE Governor. We can all forget about him never wanting the job.
If Queen on CN $, Carney gets visa. MT @gideonrachman: Mark Carney a great choice for Bank of England. Will the Home Office give him a visa?
Well Mark carney speaks fluent French like a good Canadian should. Might help with relations with our European partners perhaps?.......
Wise choice for new Bank of Eng Governor: Mark Carney. Unfamiliar, indeed rare mood in Chamber with whole House welcoming the appointment!
They noticed Canada's household debt levels when they appointed Mark Carney, right?
Mark Carney: "We have a good record here, a record of success in our financial system."
Mark Carney did get his masters and doctorate in economics at Oxford after all.
Canadian Mark Carney to head up Bank of England! Well, staple me to a maple tree. #darkhorse
Difficult day for Finance Minister Jim Flaherty, who is close to both @TOMayorFord and Mark Carney. #cdnpoli #onpoli #topoli
Small list forming of Goldman alumni at Europe's big 2 central banks. Carney & Broadbent at BoE, obviously Draghi at ECB.
Carney leaving? Ford thrown out of office? Just some casual news for us to wake up to in the west. AIIIEEE. #TOpoli #cdnpoli
David R Silva
"He is acknowledged as the outstanding central banker of his generation," Osborne said of Carney. http://t.co/MmHJCLpP
.@bankofcanada's Mark Carney dodges the Liberal leadership bullet and lands on the other side of the pond with style.
Carney leaving is a tough loss for Canada, but a significant validation of the Canadian central banking system #cdnpoli
New BoE gov Mark Carney speaks in clear plain language! Understood exactly what he was saying on the @BBCnewschannel at his presser.
"Canada was better than any other western economy during the crisis" Chancellor of the Exchequer #BoE #Carney #Ialwayshadfaith
NDP wishes Carney good luck for the future. Will watch closely who will be chosen. "Big shoes to fill" #cdnpoli
"Overall, the market reaction thus far to Carney's surprise announcement has been fairly muted, but this could change over time, of course, depending on who is eventually elected to governor,'' observed Capital Economics Canada economist David Madani.
"Whoever this turns out to be, though, they will face new and big challenges, namely a struggling global economy and a potentially severe housing market correction.''
Carney will continue to be at the helm of the Canadian central bank until June 1, 2013.
The dollar had started the session lower amid a weak showing in commodity prices while traders looked for eurozone officials to come to a deal on getting the next instalment of bailout money to Greece.
Meanwhile, eurozone finance ministers met in Brussels Monday for a third time in recent weeks to get a deal together to release some C44 billion for Greece, which has been surviving on bailouts since 2010.
The eurozone ministers, Greece's international creditors and the International Monetary Fund have been unable to reach an agreement.
Greece is unlikely to complete its program of budget cuts and reforms by 2014 and is likely to be given an additional two years to reach that goal.
But that extension will cost several billion euros more and the next instalment is being held up by disagreements over how to fund this.
Commodity prices were mixed with January crude on the New York Mercantile Exchange down 48 cents to US$87.80 a barrel.
The December copper contract on the Nymex was unchanged at US$3.54 a pound.
December bullion was down $2.10 to US$1,749.30 an ounce.
On the economic front, the major event of the week is the September reading on gross domestic product. Statistics Canada is expected to report on Friday that the economy grew by 0.1 per cent during the month. Such a reading would translate into the economy growing by 0.9 per cent at an annual rate during the third quarter.