By Chris Fournier
Feb. 25 (Bloomberg) -- Canada’s currency weakened, snapping the longest winning streak in nine months, as weakness in U.S. stock futures drove investors to the relative safety of the greenback on concern equities will not hold yesterday’s gains.
“I think we need to see a sustained rally in equities to get some confidence back in the risk trades,” said Steven Butler, director of foreign-exchange trading in Toronto at Scotia Capital, a unit of Canada’s third-largest bank. “Fat chance and thin chance.”
The Canadian dollar declined 0.4 percent to C$1.2458 per U.S. dollar at 8:11 a.m. in Toronto, from C$1.2423 yesterday. One Canadian dollar buys 80.27 U.S. cents. The loonie, as the currency is known, rose five straight days ending yesterday, the longest stretch of gains since May.
Standard & Poor’s 500 Index futures slipped 0.2 percent and futures on the Dow Jones Industrial Average futures fell 0.1 percent on deepening concern the recession will wipe out earnings. The S&P 500 yesterday surged 4 percent and the Dow jumped 3.3 percent.
Canada’s currency will depreciate to C$1.26 against the U.S. dollar by the end of the first quarter before rebounding to C$1.22 by the end of 2009, according to the median forecast in a Bloomberg News survey of 44 economists.
The yield on the two-year government bond held steady at 1.20 percent. The price of the 2.75 percent security due in December 2010 fell 1 cent to C$102.71.
To contact the reporter on this story: Chris Fournier in Montreal at cfournier3@bloomberg.net
Posts
No comments:
Post a Comment