Canada's dollar fell for a fourth consecutive week versus the greenback, matching a stretch of declines in July 2009, as US economic growth slowed.
The currency slid against 14 of its 16 major counterparts, decreasing more than 3 per cent against the Swiss franc as investors took refuge. The loonie touched its weakest level since March versus its American counterpart before the Bank of Canada's May 31 meeting on reduced speculation policymakers will raise interest rates by the fourth quarter.
"The loonie's lag on the crosses is manifestly attributed to its role as a North American currency," said Jack Spitz, managing director of foreign exchange at National Bank of Canada in Toronto. "It's a good example of the overriding influence of soft US economic data." Crosses refer to trades involving currencies other than the US dollar.
Canada's dollar, also known as the loonie for the image of the aquatic bird on the C$1 coin, depreciated 0.2 per cent to 97.61 cents versus the greenback, from 97.42 on May 20, extending its monthly drop to 3.2 per cent. The currency touched 98.16 on May 25 and 26, the weakest level since March 28. The loonie tumbled 3.4 per cent to 86.98 centimes versus the franc.
While the Bank of Canada is due to meet this week, it's not expected to raise its one per cent target rate for overnight lending until the third quarter, according to the median forecast of 20 economists in a Bloomberg News survey.
December 2011 bankers' acceptance contracts, which indicate short-term rate expectations, yielded 1.50 per cent on Friday, the lowest since the contract started trading in 2008.