The loonie was down 0.20 of U.S. cent to 79.78 cents US.
The central bank makes its next rate announcement on Wednesday amid a complete about-face of market expectations over the last week. Analysts had widely expected the bank to follow up the surprise quarter-point rate cut delivered in January with another decrease this week.
However, bank governor Stephen Poloz made clear in a speech last week that the move was designed to help buy the bank time to assess the impact of the collapse of oil prices on the economy. And that indicated that the bank will remain on hold for the time being.
Oil prices plunged 40 per cent from the end of November alone after OPEC refused to cut production to help address a global supply/demand imbalance.
Meanwhile, China's central bank announced Saturday that it was cutting its key rate by a quarter point to 5.35 per cent, the lowest in more than five years, as the government aims to keep to its growth target of around seven per cent.
The rate cut came as China's official survey of purchasing managers showed a contraction in the manufacturing sector for a second month in a row. The official manufacturing PMI came in at 49.9 in February, up slightly from 49.8 in January.
Oil prices were volatile with prices returning to the negative column during the afternoon and the April contract slipped 17 cents to US$49.59 a barrel.
Metals were mixed with April gold down $4.90 to US$1,208.20 an ounce while May copper was up a penny at US$2.70 a pound after prices rose four per cent last week.
The major Canadian data of the week comes out Tuesday. Statistics Canada is expected to report that gross domestic product for the fourth quarter came in at an annualized rate of two per cent.
In the U.S., the Institute for Supply Management said Monday that its manufacturing index dropped to 52.9 in February from 53.5, roughly in line with expectations. Among other things, the reading reflected a stronger American currency and lower oil prices, which have cut capital spending plans by energy companies, as well as the recently ended labour disruptions at West Coast ports that impeded supply chains.
It's a heavy week for American data. Markets will also take in vehicle sales, the ISM's non-manufacturing index, factory orders and the government's employment report at the end of the week.
Canadian jobs data for February won't be released until March 13.