The Euro to Canadian Dollar (EUR/CAD) exchange rate strengthened by around 0.39% on Thursday morning.
After having softened considerably amid unresolved issues between Greece and the Eurogroup, the shared currency recovered some of its losses on Thursday as traders fear the declination was overdone.
The Canadian Dollar, meanwhile, softened versus most of its major peers thanks to falling oil prices. With oil nearing the $50 a barrel mark, many experts forecast further price depreciation amid mounting oversupply.
The Euro to Canadian Dollar (EUR/CAD) exchange rate is currently trending in the region of 1.4244.
The Euro to Canadian Dollar (EUR/CAD) exchange rate was trending within a limited range on Wednesday afternoon.
As tensions between Greece and the Eurogroup mount, the shared currency softened versus the majority of its most traded currency rivals. Additional declination is as a result of less-than-impressive Eurozone construction output.
The Canadian Dollar, meanwhile, softened versus nearly all of its major peers thanks to declination in the crude market. With demand cooling and supply rising, prices are expected to drop below $50 a barrel again.
The Euro to Canadian Dollar (EUR/CAD) exchange rate is currently trending in the region of 1.4128.
Euro (EUR) Exchange Rate Softens on Grexit Potential
The common currency softened on Wednesday after Tuesday’s Eurogroup meeting failed to find a utilitarian resolution to Greece’s debt crisis. Fears that they will be unable to agree on a compromise has seen trader confidence cool with regards to Euro investment.
‘If we want to avoid going into unknown territory, the only way is to have some time and some tranquility,’ French Finance Minister Michel Sapin told reporters in Brussels Tuesday. ‘That means the prolongation of the program. It’s the only legal tool available.’
Additional Euro losses can be attributed to disappointing construction data. Month-on-month seasonally-adjusted Eurozone Construction Output declined by -0.8% in December following November’s -0.5% drop. On a yearly basis, construction output dropped from 0.5% to -3.5%.
The Euro to Canadian Dollar (EUR/CAD) exchange rate has fallen to a low of 1.4113 today.
Canadian Dollar (CAD) Exchange Rate Dives on Crude Decline
Oil prices declined by around 1.55% on Wednesday to just under $53 a barrel. This is due to cooling demand whilst supply continues to grow. The ‘Loonie’ (CAD) is sensitive to changes in oil and so demand for the Canadian asset dampened considerably.
Fereidun Fesharaki, chairman of the global consultant Facts Global Energy, said; ‘There is more supply than demand. We are storing onshore and offshore and running out of space. In the second quarter, when the seasonal demand is down, we could see another major drop in the price.’
Euro to Canadian Dollar (EUR/CAD) Exchange Rate Forecast to Gain
Although the potential for a Grexit is weighing on demand for the shared currency, continued declination in the oil market is likely to significantly impact the Canadian Dollar. Therefore, the Euro to Canadian Dollar (EUR/CAD) exchange rate is may extend gains as Wednesday’s trade progresses. With that being said, Canadian Wholesale Sales data has the potential to provoke volatility.
The Euro to Canadian Dollar (EUR/CAD) exchange rate reached a high of 1.4169 today.