The Canadian dollar fell against its major trading partners in the European session on Monday, a massive decline in global demand for crude and uncertainty around storage of excess supply pushed down oil prices.
Benchmark Brent crude for June delivery fell $1.13 to $26.95 per barrel.
With global economies remaining on lockdown due to the virus outbreak, oil demand has fallen sharply, causing a build in stockpiles.
Monday’s plunge comes despite a historic production cut aimed to backstop prices by Russia and other oil-producing nations.
Earlier this month, OPEC and its allies finalized an unprecedented production cut of nearly 10 million barrels, or a tenth of global supply, to boost prices amid the coronavirus pandemic.
The International Energy Agency has warned that the output cuts may not be enough to offset a severe plunge in oil demand. The IEA expects a 29 million barrel per day (bpd) dive in April oil demand to levels not seen in 25 years.
The loonie declined to 0.8988 against the aussie, its weakest since March 10. The currency may locate support around the 0.92 level.
The loonie depreciated to a 4-day low of 1.4132 against the greenback, after rising to 1.4014 in the Asian session. Further decline in the currency is likely to see support around the 1.46 level.
The loonie weakened to a 4-day low of 76.30 against the yen, from Friday’s closing value of 76.78. The next key support for the currency is seen around the 72.00 level.
Data from the Ministry of Finance showed that Japan posted a merchandise trade surplus of 4.946 billion yen in March.
That was well shy of forecasts for 459.9 billion yen and down sharply from the 1,109.8 billion yen surplus in February.
The loonie slid to 1.5340 against the euro, setting a 4-day low. The loonie is likely to challenge support around the 1.55 mark.
Data from Eurostat showed that the euro area trade surplus increased in February as exports increased from January amid a fall in imports.
The trade surplus rose to a seasonally adjusted EUR 25.8 billion in February from EUR 18.2 billion in January.
Canada wholesale sales for February are set for release at 8:30 am ET.
The material has been provided by InstaForex Company – www.instaforex.com
Disclaimer: Please note all prices are for information only, they should not be relied upon for accuracy or trading. All prices quotes are based on CFD prices and are similar though not always identical to real exchange prices. STOCKTRKR or anybody connected with STOCKTRKR will not accept any liability for loss or damage arising from use of any information/commentary/charts or articles which is provided 'as is' for educational purposes only, nothing contained on this website should be considered as investment advice - please seek proper investment advice from registered financial broker or institution if you wish to trade on global markets and ensure you are familiar with the risks.
