Canadian Dollar Falls as Crude Remains Under Pressure

 
   By Ben Dummett 
 

        TORONTO--The Canadian dollar remained under pressure against the U.S. currency Friday as crude prices continued their descent and investors maintained their expectations of a interest hike by the U.S. Federal Reserve later this year.
        The U.S. dollar was recently at C$1.3047, from C$1.3032 late Thursday, according to data provider CQG., and earlier in the session traded through psychological resistance of 1.3050, a level not seen since the credit crisis and before that in 2004.
        "We're in unchartered levels," said Rahim Madhavji, president of KnightsbridgeFX.com
        The Canadian dollar's performance is tied closely to the direction of crude prices since energy production generates about 10% of the GDP. That means continued declines in the oil price, which fell another 0.6% to $48.14 in New York Friday, threaten to undermine any economic rebound.
        Diverging interest rate policies in Canada and the U.S. are also exacerbating the Canadian dollar's problems. Lower oil prices heightened the prospect of another rate cut in Canada this year, while all signs so far point to rate hike in the U.S. over the coming months, making the U.S. dollar even more attractive against it Canadian counterpart.
        "So far it's not looking good for the Loonie," Mr. Madhavji said, referring to the common nickname for the Canadian currency.
        Write to Ben Dummett at ben.dummett@wsj.com
        (END) Dow Jones Newswires

        July 24, 2015 16:19 ET (20:19 GMT)

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