Canada’s dollar pared an earlier decline after minutes from the last meeting of the Federal Reserve showed policy makers remain committed to additional monetary easing if needed.
The currency had dropped earlier against a majority of its most-traded peers, falling along with the dollars of fellow commodity exporters Australia and New Zealand as demand for safety drove the greenback and yen higher and a report showed retail sales unexpectedly fell in June. Bank of Canada Governor Mark Carney reiterated in a speech that interest rate increases may become appropriate.
“Higher-beta currencies are all gaining versus the U.S. dollar on the back of increased easing expectations,” said Brian Kim, a currency strategist at Royal Bank of Scotland Group Plc in Stamford Connecticut. “Carney reiterating that the Bank of Canada could remove stimulus is Canadian-dollar supportive.”
Canada’s currency, nicknamed the loonie, weakened 0.4 percent to 99.33 cents per U.S. dollar at 2:24 p.m. in Toronto. It touched 98.43 cents yesterday, the strongest level since May 3. It weakened as much as 0.6 percent today. One Canadian dollar buys $1.0068.