By Commodity News Service Canada
WINNIPEG, Oct. 22 The Canadian dollar was down sharply relative to the U.S. dollar Wednesday morning, reacting to disappointing Canadian retail sales data, analysts said.
According to Statistics Canada, retail sales dropped 0.3 per cent in August, to C$42.4 billion. It was second consecutive monthly decline, following gains in the previous six months.
At 8:54 CDT Wednesday the Canadian dollar was at U.S.$0.8870 or U.S.$=C$1.1274, which compares with Tuesday’s North American close of U.S.$0.8906 or U.S.$=C$1.1228.
Some of the weakness was also linked to positions squaring ahead of the Bank of Canada’s policy announcement later Wednesday morning. The central bank is expected to leave interest rates unchanged.
Weakness in gold prices also spilled over to weigh on the Canadian currency, though stronger crude oil values were supportive.
The TSX was down 15.39 points, or 0.11%, at 8:54 CDT Wednesday morning to sit at 14,532.32.
