Loonie falls to 20-month low after Bank of Canada’s supersized rate hike – National


The loonie hit a 20-month low, one day after the Bank of Canada announced its largest interest rate hike since 1998.

The Canadian dollar traded at a low of 75.62 cents US in early trading, a nearly one-a-half-cent drop from 77.07 cents US on Wednesday.

That’s the lowest level since Nov. 4, 2020.

The currency partially recovered to 76.06 cents US in late-morning trading.

The U.S. dollar, which has been flying high amid the threat of recession, gained further ground against most major currencies primarily due to short-term yields rising following a report Wednesday that the annual inflation rate in the U.S. hit 9.1 per cent in June, the highest in more than 40 years.

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Scotiabank chief currency strategist Shaun Osborne says “risk aversion” was dragging the Canadian dollar lower after the Bank of Canada’s bold move.

Click to play video: 'Bank of Canada surprises many with key interest rate hike'

Bank of Canada surprises many with key interest rate hike

Bank of Canada surprises many with key interest rate hike

© 2022 The Canadian Press



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