Good thing it's time for lunch.
"Loonie’s longest losing streak reflects Canada’s malaise" by Ari Altstedter and Allison McNeely Bloomberg News January 15, 2016
The Canadian dollar is on its longest losing streak as speculation mounts that the central bank will cut interest rates back to the record low only seen amid the 2009 financial crisis.
The currency has weakened for 10 straight days against the US dollar Wednesday, the longest run of daily losses since the country ended its currency’s peg to the US dollar in 1971 and let it trade freely. The streak surpassed a nine-day run in April 2005.
The declines come during a week when market turmoil in China helped push crude oil, until last year Canada’s largest export, below $30 per barrel for the first time in 12 years. That stoked speculation there will be no quick return to the near-$100 per barrel oil that fueled growth the past decade. Recent domestic data have shown few signs other parts of the Canadian economy are stepping in to fill the void left by oil.
“Oil is at levels people hadn’t been considering except as a worst-case scenario,” said Andrew Kelvin, senior fixed-income strategist at Toronto-Dominion Bank.
The loonie, as the Canadian dollar is known for the image of the aquatic bird on the C$1 coin. The slide in oil has increased the odds the Bank of Canada will cut interest rates to 0.25 percent at its Jan. 20 meeting. Canada’s benchmark five-year and 10-year bond yields touched record lows this week.
The central bank cut rates twice last year to guard against oil’s collapse.
Oil’s fall combined with the rate cuts have contributed to the loonie losing 31 percent of its value during the past three years.
Macquarie Group Ltd.’s David Doyle, Bloomberg’s top-ranked forecaster for the Canadian dollar last year, said he expected the currency to fall to a record low 0.59 US cents, or C$1.6949 per US dollar, by the end of the year as he added his voice to those predicting a rate cut next week.
“It’s three strikes and you’re out,” Nick Bennenbroek, head of currency strategy at Wells Fargo Securities LLC, said by phone from New York. “With China and oil prices and the Bank of Canada all against the Canadian dollar, it’s sort of flat on its back right now. It’s really struggling.”
Believe it or not, I speculated that the Canadian dollar would replace the AmeriKan dollar -- crazy, huh? -- and lost everything.