Canadian Dollar Slides On Falling Oil Prices

The Canadian dollar dropped against its major opponents in the European session on Friday, as oil prices weakened amid signs of rising global supply and concerns over economic slowdown in the face of a worsening U.S.-China trade war.

Crude for December delivery dropped $1.03 to $59.67 a barrel.

China's producer price inflation slowed for the fourth month in October on cooling domestic demand, suggesting that economic momentum in the world's second-largest economy is softening in the face of simmering trade frictions with the United States.

Traders remained concerned that an economic slowdown may curb fuel demand growth.

Further undermining the currency was a higher dollar, which was buoyed by the Fed's hawkish stance on monetary policy.

Interest rate futures implied a 78 percent chance the U.S. central bank would raise rates at its Dec. 18-19 meeting.

Overnight news that U.S. federal judge had halted construction of the Keystone XL oil pipeline project also weighed on the currency.

The currency has been trading lower against its major rivals in the Asian session, with the exception of the aussie.

The loonie dropped to a 2-day low of 86.23 against the yen, from a high of 86.76 hit at 6:00 pm ET. The loonie is poised to find support around the 85.00 level.

The loonie declined to 1.3198 against the greenback, its weakest since September 10. The loonie is likely to challenge support around the 1.33 level.

The loonie edged down to 1.4986 against the euro, from its early high of 1.4936. The loonie is seen finding support around the 1.51 mark.

Having advanced to 0.9532 against the aussie at 8:15 pm ET, the loonie reversed direction and fell to 0.9561. The next possible support for the loonie is seen around the 0.98 level.

Data from the Australian Bureau of Statistics showed that Australia home loans declined a seasonally adjusted 1.0 percent on month in September, coming in at 50,673.

That was in line with expectations following the 2.1 percent contraction in August.

Looking ahead, U.S. producer prices for October, wholesale inventories for September and University of Michigan's preliminary consumer sentiment index for November are scheduled for release in the New York session.

Federal Reserve Governor Randal Quarles gives speech about financial regulation at the Brookings Institution in Washington DC at 9:05 am ET.

US Dollar vs CAD (FX:USDCAD)
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