Canada’s dollar sank as the nation’s crude-oil prices slid relative to a U.S. benchmark and concern increased that the economy will be hurt by the American government shutdown.
The currency touched a two-week low against its U.S. peer as a budget impasse in Canada’s biggest trade partner persisted and another fight loomed over raising the U.S. government’s debt ceiling. The currency erased a weekly loss against the greenback yesterday as risk appetite improved amid optimism that lawmakers in Washington might reach a deal soon. Canadian employment growth slowed in August, a report next week is forecast to show.
“U.S. economic uncertainty equates to Canadian economic uncertainty — as they sneeze, we get a cold,” Jack Spitz, managing director of foreign exchange at National Bank of Canada in Toronto, said in a phone interview. “There will be a deal, but the uncertainty, combined with less-than-stellar economic releases in Canada, continues to weigh on the Canadian dollar.”
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