By Commodity News Service Canada
WINNIPEG, March 5 – The Canadian dollar closed sharply lower against the US dollar on Thursday, dropping back below the 80 cents US mark.
Broad strength in the US dollar index was contributing the Canadian currency’s weakness, as were declines in crude oil and gold, analysts said.
The Canadian dollar closed at US$0.7996 or US$1=C$1.2506 on Thursday, which compares with Wednesday’s North American settlement of US$0.8054 or US$1=C$1.2416.
Ongoing worries about slow economic growth in Europe, as the European Central Bank implements a new stimulus program on Monday, added to the bearish tone.
However, easing worries about the state of the Canadian economy after positive comments from the Bank of Canada on Wednesday, limited the downside.
Canadian bonds moved lower on Thursday, seeing some follow-through selling on Wednesday’s weakness, market watchers said.
The two-year bond yielded 0.623% Thursday, from 0.608% late Wednesday. The 10-year bond yielded 1.528%, from 1.509%. Bond yields rise as their prices fall.
