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Canadian Dollar Drops on Building Permits Report

The Canadian dollar fell today against 15 of 16 most traded currencies after the reports showed the building permits tumbled far below the expected value and on outlook for the slower employment growth in Canada.
The building permits in Canada slumped 9.2 percent in August, compared to the 3.8 decline in July. The reading was much worse than even most pessimistic forecast, which expected the 1.9 percent drop. The report tomorrow expected to show the Canadian employers added 10,700 jobs in September, less than in August when the increase was 35,800.
Not everything is bad for the loonie, as the Canadian currency is often called. The jobless claims in the US decreased more than expected, according to today’s report, and this is positive for the Canadian dollar as the US is Canada’s main trading partner. The commodity market, despite its poor performance today, looks very solid, which is supporting for the commodity currencies, including the loonie. The loonie rallied previously on the speculation that the world central banks would cut their interest rates, while Canada would keep its rates unchanged. The Bank of Canada‘s policy maker will meet on October 19th to set the key interest rate.


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