The loonie held steady on Tuesday and remained unchanged to close at 78.49 US cents despite news that world powers had reached an historic nuclear accord with Iran.
The agreement places limits on Iran's nuclear building capabilities for more than a decade in exchange for the lifting of sanctions that have weakened the Iranian economy and curtailed the country's oil production. Once free of sanctions, Iran could potentially flood the market with new oil and millions of barrels of waiting crude.
Crude prices were volatile on Tuesday, falling over 2% before rebounding and reversing losses as reaction to the agreement poured in from around the globe, particularly from the US Congress where it was met with a degree of suspicion and cynicism. Toronto's S&P/TSX composite index also recovered from earlier losses and rose more than 60 points as oil stabilized.
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The US dollar Index softened on Tuesday as US retail sales suffered an unexpected 0.3% drop in June, the first such drop since February. May US retail sales were also revised downward as some economists expressed concern about US second quarter consumer spending.
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