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CAD/USD And USD/JPY Weaken As US Confidence Falls

Published: 25 Oct at 5 PM Tags: Dollar, Pound Sterling, America, UK, Canadian Dollar, USA, Canada,

With US confidence declining and Canada’s trade prospects falling accordingly, the ‘Loonie’ was trading close to a seven-week low against its US counterpart during the North American session on Friday.

This week’s Bank of Canada policy statement and declining crude oil prices also weighed on the commodity driven asset, and as the week came to a close the CAD/USD pairing was in the region of 0.9575.

The US Dollar was also struggling, as disappointing domestic data added to the argument that the recent Federal shutdown may have caused widespread damage to the world’s largest economy.

While economists expected the University of Michigan confidence index to fall slightly, easing from 75.2 to 75 in October, it actually tumbled to 73.2.

The result saw the ‘Greenback’ extend declines against peers like the Yen and prompted this response from senior currency strategist Eric Viloria; ‘The data was soft, which argues for a weaker Dollar. The drop in consumer confidence was not surprising, given the fiscal debacle earlier in the month. Durable-goods was a weak report overall.’

A separate report revealed that US Durable goods orders climbed by 3.7 per cent in September, more than the 2.3 per cent expected, but US durables excluding transportation declined by 0.1 per cent last month rather than rising by 0.5 per cent as predicted.

In other currency news, the Pound posted a significant advance on its US rival counterpart as the UK economy was shown to have expanded by the most for three-years in the third quarter of the year.

The Pound is currently trading against the US Dollar in the region of 1.6169
As of Friday, 25th October 2013, the Pound Sterling currency rates mentioned within this news item were as follows:

GBP USD exchange rate was 1.6166, and GBP CAD exchange rate was 1.6892.
Dominic Lee About Author: (412 Posts)With over ten years experience as an economist – including four years spent as a chief economist with a major currency broker – Dominic has acquired a wealth of knowledge which he uses to forecast market movements. Dominic now works as an independent business advisor and writes for several financial publications.

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