The Canadian dollar continued to trade below parity Tuesday morning. The loonie was hit hard in trading on Monday as expectations that the Bank of Canada will make a move to cut interest rates intensified.
The release of GDP numbers for the first quarter of 2008 failed to impress markets as traders began to dump the Canadian dollar Monday in favour of other investments. According to Statistics Canada, real gross domestic product edged down 0.1 per cent in the first quarter of 2008, its first quarterly decline since the second quarter of 2003.
The Bank of Canada is scheduled to make an interest rate announcement on June 10. At the moment, analysts appear to be split on the direction the central bank will take next Tuesday. As well, the U.S. Federal Reserve meets at the end of the month to determine changes to its monetary policy moving forward.
Gold continued to trade lower today on U.S. dollar strength, while oil also retreated from recent record highs.
By 1 p.m. Tuesday the Canadian dollar was trading at 0.9933 against the U.S. dollar.
Market report prepared by Bruce Hauser
Accu-Rate Corp.
2573 Carling Ave. Ottawa, ON K2B 7H7
Tel: (613) 596-5505
E-mail: bruce@accu-rate.ca
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