The Canadian dollar has fallen to its lowest level compared to the greenback in 14 months, nearing 70 U.S. cents, and economists say the loonie could weaken further as Canada’s economy slows and investors continue to favour the U.S. dollar.
The Canadian dollar’s two-month slide coincides with Canada’s entry into a technical recession, expectations that the U.S. Federal Reserve could raise interest rates, relatively lower oil prices, heightened geopolitical uncertainty, and the lack of a deal so far in key trade talks with the United States.
While the economic challenges have contributed to the decline, economists say the biggest driver behind the weaker loonie has been renewed strength in the U.S. dollar, which has climbed against most major currencies in recent months as investors worldwide seek higher returns and safer assets. ---More...