Skip to main content
The Globe and Mail
Support Quality Journalism
The Globe and Mail
First Access to Latest
Investment News
Collection of curated
e-books and guides
Inform your decisions via
Globe Investor Tools
Just$1.99
per week
for first 24 weeks

Enjoy unlimited digital access
Enjoy Unlimited Digital Access
Get full access to globeandmail.com
Just $1.99 per week for the first 24 weeks
Just $1.99 per week for the first 24 weeks
var select={root:".js-sub-pencil",control:".js-sub-pencil-control",open:"o-sub-pencil--open",closed:"o-sub-pencil--closed"},dom={},allowExpand=!0;function pencilInit(o){var e=arguments.length>1&&void 0!==arguments[1]&&arguments[1];select.root=o,dom.root=document.querySelector(select.root),dom.root&&(dom.control=document.querySelector(select.control),dom.control.addEventListener("click",onToggleClicked),setPanelState(e),window.addEventListener("scroll",onWindowScroll),dom.root.removeAttribute("hidden"))}function isPanelOpen(){return dom.root.classList.contains(select.open)}function setPanelState(o){dom.root.classList[o?"add":"remove"](select.open),dom.root.classList[o?"remove":"add"](select.closed),dom.control.setAttribute("aria-expanded",o)}function onToggleClicked(){var l=!isPanelOpen();setPanelState(l)}function onWindowScroll(){window.requestAnimationFrame(function() {var l=isPanelOpen(),n=0===(document.body.scrollTop||document.documentElement.scrollTop);n||l||!allowExpand?n&&l&&(allowExpand=!0,setPanelState(!1)):(allowExpand=!1,setPanelState(!0))});}pencilInit(".js-sub-pencil",!1); // via darwin-bg var slideIndex = 0; carousel(); function carousel() { var i; var x = document.getElementsByClassName("subs_valueprop"); for (i = 0; i < x.length; i++) { x[i].style.display = "none"; } slideIndex++; if (slideIndex> x.length) { slideIndex = 1; } x[slideIndex - 1].style.display = "block"; setTimeout(carousel, 2500); }

The Canadian dollar fell to a four-year low against its U.S. counterpart on Tuesday as the greenback broadly rebounded, while a rally in oil was not enough to convince investors to turn more bullish on Canada’s commodity-linked currency.

At 2:44 p.m. (1844 GMT), the Canadian dollar was trading 0.4% lower at 1.3748 to the greenback, or 72.74 U.S. cents. The currency hit its weakest intraday level since Feb. 24, 2016 at 1.3796.

“Today has been all about the (U.S.) dollar,” said Bipan Rai, North America head of FX Strategy at CIBC Capital Markets.

Story continues below advertisement

“The move is due to dollar shortage outside of the U.S. As supply chains get disrupted, there is a shortage of dollars,” Rai said.

The gap between Libor and overnight index swaps, a measure of bank funding pressures, was at near 40 basis points for a 3-month term, up from 15 basis points in February.

The greenback rallied 1.6% against a basket of major currencies, recovering from a 17-month low on Monday, while oil prices jumped a day after the biggest rout in nearly 30 years as investors eyed the possibility of economic stimulus.

U.S. crude oil futures were up more than 10% at $34.47 a barrel but that did not impress currency traders after a 25% plunge the day before.

If Saudi Arabia and Russia do not reach a production agreement then the Canadian dollar could be heading toward 1.40, Rai said.

Money market see it as likely the Bank of Canada will cut interest rates by 50 basis points next month, which would match the size of last week’s move, its biggest easing in more than a decade.

Canadian banks have increased oil and gas lending at about double the rate of total business loan growth over the past three quarters, raising the prospect of higher loan losses after Monday’s oil price crash.

Story continues below advertisement

Canadian government bond yields rose but by much less than the increase in U.S. Treasury yields. The 10-year yield was up 2.4 basis points at 0.558%, while the gap between it and its U.S. equivalent moved by 18.5 basis points to a spread of about 15 basis points in favour of the U.S. bond.

Be smart with your money. Get the latest investing insights delivered right to your inbox three times a week, with the Globe Investor newsletter. Sign up today.

Report an error
Tickers mentioned in this story
Due to technical reasons, we have temporarily removed commenting from our articles. We hope to have this fixed soon. Thank you for your patience. If you are looking to give feedback on our new site, please send it along to feedback@globeandmail.com. If you want to write a letter to the editor, please forward to letters@globeandmail.com.

Welcome to The Globe and Mail’s comment community. This is a space where subscribers can engage with each other and Globe staff. Non-subscribers can read and sort comments but will not be able to engage with them in any way. Click here to subscribe.

If you would like to write a letter to the editor, please forward it to letters@globeandmail.com. Readers can also interact with The Globe on Facebook and Twitter .

Welcome to The Globe and Mail’s comment community. This is a space where subscribers can engage with each other and Globe staff. Non-subscribers can read and sort comments but will not be able to engage with them in any way. Click here to subscribe.

If you would like to write a letter to the editor, please forward it to letters@globeandmail.com. Readers can also interact with The Globe on Facebook and Twitter .

Welcome to The Globe and Mail’s comment community. This is a space where subscribers can engage with each other and Globe staff.

We aim to create a safe and valuable space for discussion and debate. That means:

  • Treat others as you wish to be treated
  • Criticize ideas, not people
  • Stay on topic
  • Avoid the use of toxic and offensive language
  • Flag bad behaviour

Comments that violate our community guidelines will be removed.

Read our community guidelines here

Discussion loading ...

To view this site properly, enable cookies in your browser. Read our privacy policy to learn more.
How to enable cookies