The Canadian Dollar, also known as Loonie declined to the lowest level in more than 7 days against the US counterpart after growth of China slowed more than what was forecasted in the 1st quarter of this year. Incidentally, China is the one of the biggest trading partners of Canada and such a result posted from China, has sapped the demand for the commodity exports for Canada.
Not only against USD, but Loonie weakened against most of the major counterparts of the same on speculation that a slowing growth in both home and abroad will force the Bank of Canada to trim down the economic growth forecast of the same during the policy meeting, all set to happen on 17th April. Incidentally, a separate statistics released on the last week showed that the retail sales volume of US contracted in March, contrary to the expectations. Incidentally, US is the biggest trading partner of Canada. Various commodities including crude oil experienced a tumble in price. Crude oil, incidentally, is the biggest export of Canada.
According to the Chief Economist of the HSBC Holding Plc., David Watt, not only the retail sales figures, but other data that is coming out of the US off late, suggests that the biggest economy in the world has started to lose some of the tacticos. Many investors felt that the global economy is gaining the traction, however, as it seems, the Chinese number was not able to hit the 8%. So, things have kind of swung down a little on the near basis erasing the positive sentiment all over on the global economy. Watt added that many investors feel that the current situation kind of represents a slowdown in the global economy, a sentiment that it is hitting Canada hard.
Loonie has declined by 0.7% on today against USD and is currently priced at C$1.0206 per USD. Thereby it reached the lowest level for the currency since 5th April.
Incidentally, the Gross Domestic Product of China increased by 7.7% last quarter, if compared to the figures of a year earlier. The data was released by the National Bureau of Statistics. In the previous 3 months, the growth of GDP was of 7.9%. On the other hand, the analysts predicted a growth of 8% in the 1st quarter, however, the actual results kind of lagged behind.