Skip to main content

The Globe and Mail

Loonie ends lower as traders look to Bank of Canada announcement

Canadian dollars.

Jeff McIntosh/The Canadian Press

The Canadian dollar closed slightly lower Monday, two days before the Bank of Canada makes its next announcement on interest rates.

The loonie shed 0.06 of a cent to 97.08 cents (U.S.).

Many economists expect the bank will keep its key rate at 1 per cent until around the fourth quarter of 2014.

Story continues below advertisement

Traders also looked ahead to a raft of economic reports that were held up because of the partial U.S. government shutdown that dragged on this month until late last week.

The major economic report of the week is the U.S. government's employment report. That's due on Tuesday and could provide investors with an indication as to when the Fed will start reducing its $85-billion worth of monthly asset purchases.

Until the U.S. debt crisis this month, most investors thought the Fed's so-called "tapering" of its stimulus program would start by December. Many now think it won't start until Janet Yellen takes the chair in early 2014.

The commodity-sensitive loonie failed to react to falling oil prices, which were at their lowest level since July. The November crude contract on the New York Mercantile Exchange fell $1.59 to $99.22 a barrel – its lowest close since July 1 – amid rising supplies of crude and lower demand.

December copper was unchanged at $3.30 a pound while December gold bullion climbed $1.20 to $1,315.80 an ounce.

Meanwhile, traders digested data showing a drop in existing home sales in September, held back by higher mortgage rates and rising prices.

The National Association of Realtors says the number of resale homes fell 1.9 per cent last month to a seasonally adjusted annual rate of 5.29 million. That's down from a pace of 5.39 million in August, which was revised lower. The sales pace in August equalled July's pace. Both were the highest in four years and consistent with a healthy market.

Story continues below advertisement

Report an error
As of December 20, 2017, we have temporarily removed commenting from our articles. We hope to have this resolved by the end of January 2018. 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.