But overall, the dollar was mixed on the day, falling against safe haven currencies like the Japanese yen and Swiss franc. The loonie may find support around 88.00 against the yen, 1.37 against the greenback and 1.48 against the euro.
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Still, Canadians should reap some benefit from the falling world price for crude, McTeague said, predicting gas at the pumps would fall by 2 to 3 cents a litre by Wednesday.
Overseas markets were also sharply lower Tuesday, with Germany’s DAX down two per cent, while the CAC-40 in France was 1.6 per cent lower and Britain’s FTSE 100 fell 1.4 per cent.
MSCI’s broadest index of Asia-Pacific shares outside Japan .MIAPJ0000PUS fell 0.4 percent, erasing all the gains made so far this month, with resource-heavy Australian shares .AXJO leading decline with a fall of 0.9 percent. The price of $37.59 a barrel is the lowest level reached since back in 2009.
“Under those circumstances, the Canadian dollar could rebound too”. The report estimated the real GDP growth in Q4 at annualized minus 1.0 percent. It has made session high at 1.3522 and lows at 1.3502 levels.
European shares gained on Monday as the price of crude neared 7-year lows, pulling down oil shares, and Electrolux’s share price slumped after its deal to buy General Electric’s appliance business fell through.
The Organization of Petroleum Exporting Countries, the world’s biggest oil cartel, isn’t helping to stem the oil supply glut. “I think what it all comes down to is the fact that the Canadian economy looks weak”, Murata said, adding that the US dollar will probably rise to C$1.40 in the first half of 2016. The Canadian dollar slipped to 11years low on Monday, weighted down by further fall in crude oil prices and the likely start of U.S. Federal Reserve tightening next week.
The Dow Jones industrial average was down 91.06 points, or 0.51 per cent, at 17,639.45, the S&P 500 was down 7.44 points, or 0.36 per cent, at 2,069.63 and the Nasdaq Composite was up 0.02 points, or 0 per cent, at 5,101.83.
Long-dated U.S. Treasury debt prices held firm after rallying on Monday as the drop in oil prices pointed to benign inflation, potentially tempering the Fed’s policy tightening path after the expected liftoff on December 16.
The 10-year US debt yield fell to 2.216 percent, off one-month high of 2.358 percent touched on Friday following strong USA employment data.
The February gold contract fell $5.50 to US$1,080 per troy ounce.
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Many observers believe this could be a new normal for oil prices and the loonie for the next few months, as the global crude oversupply problem shows no signs of abating.
