Canadian Dollar Falls As Oil Prices Weaken

The Canadian dollar drifted lower against its most major counterparts in the Asian session on Monday amid falling oil prices, as rising oil rig count in the U.S. offsets OPEC-led attempts to trim oversupply.

Crude for July delivery fell $0.13 to $49.67 per barrel.

Data from oil services group Baker Hughes showed that the oil rig count rose by two to 722 last week. The total active US rig count, including oil and natural-gas rigs, increased by seven to 908 for the week.

The American Petroleum Institute releases crude inventory data on Wednesday, while the Energy Information will publish its official data on Thursday. The weekly US stocks data from the API and EIA is delayed by a day due to the Memorial Day holiday on Monday.

The G 7 summit over the weekend failed to make progress on narrowing differences on climate change, as the U.S. president said he is still reviewing his government’s position whether to scrap the United States’ involvement in the Paris Agreement.

The leaders were unified on stepping up efforts to combat terrorism, but differences surfaced on trade and climate change at a confidential session on the first day of the G7 summit in Sicily, media reports quoted German Chancellor Angela Merkel as saying.

The loonie rose against its major rivals on Monday, with the exception of the Japanese yen.

The loonie that closed Friday’s trading at 1.3447 against the greenback edged down to 1.3465. The next possible support for the loonie is seen around the 1.36 region.

The loonie pared gains to 82.64 against the yen, from a high of 82.82 hit at 9:15 pm ET. On the downside, 80.00 is likely seen as the next support level for the loonie.

The loonie edged down to 1.5042 against the euro, off early high of 1.5018. Continuation of the loonie’s downtrend may see it finding support around the 1.52 area.

On the flip side, the loonie rose back to 0.9999 against the aussie, heading to pierce its early 1-1/2-month high of 0.9997. The pair was worth 1.0009 when it ended last week’s trading.

Looking ahead, Eurozone M3 money supply for April is due in the European session.

The European Central Bank President Mario Draghi testifies about the economy and monetary developments before the Economic and Monetary Affairs Committee, in Brussels at 10:00 am ET.

The U.S. markets remain closed due to the Memorial Day holiday.
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