- Canadian dollar rebounds after descending to 11-year low
- CIBC says sell loonie during rallies on economic outlook
The Canadian dollar rose for the sixth day, its longest stretch of gains since June 2014, as advancing crude-oil prices led some traders to cancel bets against the currency.
The loonie, as it’s dubbed because of the image of the aquatic bird on the C$1 coin, is rebounding from last week’s 11-year low, spurred on by a four-day increase in crude oil. While the currency has climbed about 3 percent since Sept. 29, the median forecast in a Bloomberg survey is for it to weaken to C$1.34 against its U.S. counterpart by year-end.
“The predominant driver of this move is profit-taking on existing trades, mixed with a rally in crude,” Bipan Rai, director of foreign-exchange strategy at Canadian Imperial Bank of Commerce’s CIBC World Markets unit, said from Toronto. “We would be sellers on these spikes,” he said, amid a negative view on the nation’s economy and uncertainty in the run-up to this month’s elections.
The currency strengthened 0.1 percent to C$1.3019 against the greenback. West Texas Intermediate crude futures rose as much as 2.4 percent.
The loonie has declined 2.5 percent against the U.S. dollar in the past three months. Canada’s central bank has cut its benchmark rate twice this year, to 0.5 percent.