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The Canadian dollar started this week losing versus most of the 16 main traded currencies as a negative performance in stocks and commodities influenced the loonie’s attractiveness today, as investors opted for the safety of the greenback.

After last week’s declarations from the Bank of Canada affirming that a strong loonie could delay the economic recovery in the North American nation, the loonie’s attractiveness decline, also being affected today by a bearish stock market in Asia and a decline in demand for commodities, erasing the Canadian currency past weeks’ gains.

USD/CAD traded at 1.0974 as of 10:26 GMT from an opening rate of 1.0915 yesterday.

If you want to comment on the Canadian dollar’s recent action or have any questions regarding this currency, please, feel free to reply below.

In the end of this week’s session the Canadian dollar pared its previous gains as risk aversion rose this Friday, affecting U.S. stocks performance and also the crude oil, the main Canadian commodity exported to the United States, influencing the loonie’s outlook.

The Canadian currency rose 12 percent versus its U.S. counterpart this year, and since June, Bank of Canada officials are stressing on the fact that a very strong loonie may bring a negative impact to national exporters, and measures to be taken are not ruled out, if the loonie climb further. This month the Canadian currency has been one of the biggest losers versus its U.S. counterpart among the 16 most traded currencies in foreign-exchange markets, losing 1.3 percent as this week ended, which is certainly a favorable scenario for Canadian exporters.

The rally perceived in the beginning of the month which set the loonie to around 1.07 per U.S. dollar raised eyebrows in the Bank of Canada, considering that a stronger currency decreases competitiveness for one nation’s products, with statements regarding this fact already helping to prevent the rally to continue temporarily. It is unlikely that the loonie will rise further, as the national bank already announced that it will take measures to stop its climb, so a rather neutral or bearish trend can be expected for the Canadian currency in the short term.

USD/CAD closed this week at 1.0913 from a previous rate of 1.0863 on Thursday.

If you want to comment on the Canadian dollar’s recent action or have any questions regarding this currency, please, feel free to reply below.

The Canadian dollar dropped on Forex today, mainly against the U.S. dollar and the Japanese yen, as the investors favored less commodity-dependent currencies.

Commodities fell down during the European session and continued to fall during the New York trading session. Crude oil, gold and copper declined, as the traders were concerned with the slowdown of the U.S. economy.

It’s an interesting situation when the both high-yielding and low-yielding currencies depreciate. Those that yield higher interest rates are sold because they are risky and the investors don’t want to hold risky assets during the times of the global financial instability. Those that are low-yielding, but are commodity-dependent, lose because the commodity-consuming countries are risking to fall into the recession.

Recently the Bank of Canada reduced the benchmark interest rate by 50 basis points — from 4.00% to 3.50%. And it will probably cut the rate again during the next meeting. But the loonie’s Forex rate probably won’t be determined by this decision.

USD/CAD gained almost 0.9% today and went up from 0.9888 at the day’s opening in Asia to 0.9974 as of 18:24 GMT.