The Canadian dollar fell to the lowest level in two years as weak exports added to concern expressed by Bank of Canada policy makers that a projected driver of economic growth has not yet materialized.
The dollar will rise versus most of its major counterparts over the next year and find particular strength versus its European peers as rate-cut expectations increase, according to Adam Cole of Royal Bank of Canada.
The pound posted its biggest weekly decline versus the dollar since July as signs the U.S. economy is strengthening fueled bets the Federal Reserve will slow stimulus that tends to debase the greenback.
The Bloomberg U.S. Dollar Index held a gain from yesterday before a report analysts said will show employers last month added the most jobs since April, boosting the case for the Federal Reserve to cut its stimulus program.
The Canadian dollar snapped three days of gains on speculation the Bank of Canada will downgrade its economic forecasts after a government shutdown hampered growth in the U.S., Canada’s largest trading partner.
The pound approached the strongest level since January versus the dollar as an industry report showed construction expanded for a fifth month in September, adding to evidence that the U.K. economy is expanding.