Investing.com - The Canadian dollar fell on Wednesday as falling oil prices weighed and the Bank of Canada kept rates steady as expected.
Oil, one of Canada’s biggest exports, fell as trade tensions between the U.S. and China exacerbated. China signaled it would use rare earth elements to put pressure on the U.S., increasing fears that the stand-off could cause a global recession.
Crude oil slumped 2.1% to $57.89 a barrel, while USD/CAD fell 0.1% to 1.3505 by 10:35 AM ET (14:35 GMT).
Meanwhile, the greenback inched up 0.1% to 97.935 amid a U.S. equity selloff and a steep inversion of the yield curve. The U.S. 10-Year Treasury note fell further below the 3-month rate, which is seen as a leading indicator of a recession.
The U.S. dollar index, which measures the greenback’s strength against a basket of six major currencies, gained 0.1% to 97.963.
The greenback was higher against the safe-haven Japaese yen, with USD/JPY up 0.03% to 109.38.
Elsewhere, the euro fell on the stronger dollar, with EUR/USD down 0.2% to 1.1141, while cable was flat, with GBP/USD at 1.2650.