Canadian Dollar Pulls Back in Currency Trading

The Canadian dollar is pulling back in currency trading on the FX market this morning. Forex trading with the loonie has been a bit unsettled lately, with the Canadian currency appreciating rapidly in recent weeks. However, with risk aversion growing today, the Canadian dollar is falling in currency trading.

The U.S. dollar is making gains against most other major currencies this morning. Concerns about the speed of economic recovery are sending forex traders looking for a safe haven and ignoring riskier currencies. Bloomberg reports on forex trading and the loonie:

“There’s a little bit more focus on the fact that the green shoots are just that, we haven’t seen the growth,” said Jonathan Gencher, Toronto-based director of currency sales at BMO Capital Markets, a unit of Canada’s fourth-largest bank. “Today risk is off.” Volume is light, and price movements are dominated by order flow, Gencher said.

Until it looks as though the global economy is ready to recover in earnest, risk aversion will remain, and the Canadian dollar wil have a hard time maintaining its gains in currency trading.