The Canadian dollar fell for the first time in five days as crude oil, the country’s largest export, fell along with commodities and equities as sentiment turned against riskier assets.
The currency weakened from a one-month high as oil and the Standard & Poor’s/TSX Composite Index (SPTSX) of Canadian stocks had their biggest loss on a closing basis in a month. It rose earlier after a report yesterday showed sales in May increased 1.9 percent, almost double the highest forecast in a Bloomberg survey of 20 economists, which had a median projection of 0.4 percent. The Bank of Canada sold two-year debt at a yield of 1.230 percent.
“Some of the real fast money had gotten short dollar/CAD and short on a couple of other axes too, and with equities selling off, with bonds selling off, with sovereigns in Europe selling off people just liquidated those short-term positions,” said Greg Anderson, head of global foreign-exchange strategy at Bank of Montreal. “We just put in the bottom in dollar/CAD and I’d be long dollars and short CAD here.” A short position is a bet that an asset will decline in value.
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