Loonie dips below 71 cents US for first time since 2003
BMO economist says dollar could dip below $0.70 before it starts to recover.
TORONTO — Canada’s dollar broke another long-term record Jan. 6, dipping briefly below 71 cents US for the first time in more than 12 years.
The Canadian dollar traded as low as 70.90 cents US just after 8 a.m. Eastern Time but later recovered somewhat.
It was at 71.03 cents US – down 0.45 from close on Jan. 5 – at about 11:30 a.m.
The Toronto Stock Exchange’s S&P/TSX Composite was down 112.84 points at 12,807.30 – adding to losses Jan. 4 and 5 that totalled 89.81 points.
In New York, the Dow Jones average of 30 stocks was down 148.16 points at 17,010.50, the broader S&P 500 index dropped 14.15 points to 2002.56 and Nasdaq was down 26.57 points at 4,864.86.
On commodity markets, February crude oil contracts were down $1.42 at US$34.55 per barrel. Gold contracts were up $11.90 at $1,090.30 per ounce and natural gas was down two cents at US$2.30 per million BTU.
The last time Canada’s dollar was worth less than 71 cents US was in August 2003, as it was recovering from a historic low of 61.79 cents US set in January 2002.
The loonie has been trading progressively lower for some time, partly because of the lower value of crude oil and other commodities, as well as slow economic growth and the US dollar’s rise against most major currencies.
Bank of Montreal chief economist Douglas Porter told a gathering of leading economists that the loonie could fall below 70 cents US before it begins to recover.
© 2016 The Canadian Press