The Canadian dollar fell from its highest level in a week as rifts emerged between U.S. politicians seeking to end a government shutdown and stave off potential default in Canada’s biggest trading partner.
The currency weakened against the majority of its most-traded peers as leaders in the U.S. Senate put on hold bipartisan talks to end the fiscal impasse and Democrats rejected an alternative plan proposed by Republicans in the House of Representatives. Fitch Ratings Ltd. placed the U.S.’s AAA credit rating on negative watch, citing failure to raise the $16.7 trillion debt ceiling in a timely manner.
“It seems like there was a lot of opposition to the deal in the House of Representatives particularly from the hardliners on the right,” said David Doyle, a strategist at Macquarie Capital Markets, by phone from Toronto. “It seems like there’s been more concessions from the Republican side so the issue now is ’is it enough to pass the House of Representatives?’”
This article is for general information purposes only. It is not investment advice or a solution to buy or sell securities. Opinions are the authors; not necessarily that of OANDA Corporation or any of its affiliates, subsidiaries, officers or directors. Leveraged trading is high risk and not suitable for all. You could lose all of your deposited funds.