BUSINESS

Loonie falls another half-cent as U.S. dollar strength moves further ahead

03/11/2015 09:09 EDT | Updated 05/11/2015 05:59 EDT
TORONTO - Canada's dollar weakened on Wednesday as the U.S. greenback continued to wreak havoc on international currencies.

The loonie ended the session half a cent lower at 78.36 cents, after briefly hitting a six-year intraday low of 78.14 cents earlier in the day.

The pullback added to a drop of more than half a cent on Tuesday, as traders bet that U.S. interest rates may start to move up a bit sooner than expected.

Currency watchers note the U.S. dollar is stronger against many currencies as the U.S. Federal Reserve prepares to raise its key interest rates at some point, which has yet to be announced.

"The Canadian dollar continues to get hammered by broad based U.S.-dollar strength," wrote Knightsbridge Foreign Exchange Rahim Madhavji in a note.

"Friday's employment data in Canada will be an important catalyst to watch and could dictate the next move up in the U.S. dollar if Canadian jobs data is weak. Oil inventory data is being closely watched and increasing inventories is negative for the Canadian dollar."

On the commodity markets, the April crude oil contract on the New York Mercantile Exchange was down 12 cents at US$48.17 a barrel.

The April gold bullion contract was down US$9.50 at US$1,150.60 an ounce, while the May copper contract was off 1.8 cents at US$2.61 a pound.