By Chris Fournier
April 27 (Bloomberg) -- Canada’s dollar fell for the first time in three days as global stocks declined and crude oil traded below $50, boosting the appeal of haven currencies such as the U.S. dollar and the Japanese yen.
“We started off with stronger bias for yen and the U.S. dollar as a consequence of the swine flu,” said Steven Barrow, head of research for Group of 10 nations in London at Standard Bank Plc. “Traders are keeping their positions pretty close to their chests at the moment.”
The Canadian currency dropped as much as 0.8 percent to C$1.2188 per U.S. dollar before trading at C$1.2162 at 8:13 a.m. in Toronto, compared with C$1.2096 on April 24. One Canadian dollar buys 82.22 U.S. cents.
The MSCI World Index, a gauge of equities in 23 developed nations, fell 0.6 percent, the first drop in five sessions. Crude for June delivery fell as much as $2.93, or 5.7 percent, to $48.62 a barrel in after-hours electronic trading on the New York Mercantile Exchange. The Canadian dollar tends to track swings in equity indexes.
The loonie will weaken to C$1.25 against the U.S. dollar by the end of this quarter before rebounding to C$1.19 by the end of March 2010, according to the median forecast in a Bloomberg survey of 38 analysts and economists. Barrow predicts the loonie will appreciate to C$1.18 within three months.
“Generally the trend is towards a weaker U.S. dollar,” he said.
To contact the reporter on this story: Chris Fournier in Montreal at cfournier3@bloomberg.net
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