The Euro remains close to its highest level in over four years against the Canadian Dollar and looks set to push higher as the ‘Loonie’ was weakened by a decline in commodity prices.
The commodity based currency as commodity prices fell as a result of fears that China, the world’s second largest economy is slowing down. The currency also remains under pressure from last week’s economic data release which showed that the number of jobs in the North American economy declined by 7,000 last month. The figure surprised economists who had expecting a rise of 15,000.
The ‘Loonie’ found some brief support earlier in the session after data showed that the annual rate of Canadian housing starts rose to 192,100 units last month from January’s total of 180,500 units. Analysts had expected Canadian housing starts to increase to 185,000 units in February.
The biggest affect upon the currency however was the disappointing data out of China. As a result of the data showing that Chinese exports unexpectedly tumbled concerns grew that the world’s second biggest oil consuming nation is experiencing an economic slowdown. The decline in China’s exports was the biggest recorded since the global financial crisis five years ago, dealing a blow to confidence after Communist Party leaders meeting in Beijing last week set a 7.5 percent economic growth target for this year.
“The Chinese export numbers are a flashing light. It raises concerns about the economy and commodity demand going forward,” said the director of futures at Mizuho Securities USA Inc.
As Crude Oil, Canada’s biggest export fell, so too did the Canadian currency.
Euro (EUR) Exchange Rates
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