The Canadian dollar tumbled below the 80-cent mark today as oil plumbed new depths.
The loonie, as the country’s dollar coin is known, hit a low point of 79.80 cents U.S., its lowest point over the past year, having been as high as 80.71 cents earlier in the day.
The dollar fell quickly in afternoon trading after the US Federal Reserve left its key interest rate unchanged but dropped hints about a future increase.
The loonie hasn’t traded below 80 cents US since April 2009.
Economists forecast the loonie could hit 75 cents by the end of the year due to several factors, including slumping oil prices.
“When oil prices start falling as they have, the Canadian dollar tumbles along with it,” said Mike Moffatt, an economist and assistant professor at the Richard Ivey School of Business at Western University.
“We’re probably going to see oil prices and the Canadian dollar slide even further. I don’t expect any large movements but I suspect we’re going to be under 80 cents for some time.”
On Wednesday, oil dropped $1.78 to US$44.45 a barrel, its lowest close since early March 2009 as U.S. oil supplies rose by almost nine million barrels last week, far higher than the 3.5-million-barrel increase that was expected.
Agencies/Canadajournal
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