By Commodity News Service Canada
WINNIPEG, March 27 – The Canadian dollar was down sharply against the US dollar on Friday, undermined by a plunging crude oil market.
The Canadian dollar closed at US$0.7937 or US$1=C$1.2600 on Friday, which compares with Thursday’s North American settlement of US$0.8019 or US$1=C$1.2471.
Traders were also flocking to more safe-haven assets, including the US dollar, in wake of soft US economic data, analysts added.
Ongoing worries about the negative impact weak oil prices could have on Canada’s economy were also overhanging the loonie amid a lack of any significant market moving data this week.
Though, some support came from the negative gap seen between Canadian and US bond yields, and news that another interest rate cut is not likely for the Bank of Canada.
Canadian bonds ended sharply higher Friday, following the corrective bounce seen in the US Treasury market, according to brokers.
The two-year bond yielded 0.524% Friday, from 0.591% late Thursday. The 10-year bond yielded 1.369%, from 1.429%. Bond yields rise as their prices fall.
