Canada Morning: C$ Lower On Decline In Oil In Light Trading

TORONTO (Dow Jones)--The Canadian dollar is lower Thursday morning as it feels pressure from lower crude oil futures prices in light trading flows resulting from the Thanksgiving Holiday in the U.S.

The U.S. dollar was trading at C$1.2356 at 9:52 a.m. EST (1452 GMT), from C$1.2340 at 8:00 a.m. EST (1300 GMT) and C$1.2265 late Wednesday.

"The market seems to be fairly quiet. Canada did weaken somewhat, not only against the U.S., but also against the crosses," said Matthew Strauss, senior currency strategist at RBC Capital Markets.

"I think a part of that has to do with commodities, and more specifically, the decline in the oil price," he said.

"We saw a nice little bounce in oil yesterday, but it's already giving back some of that. That is weighing on the Canadian dollar, and partly explains why we've also weakened against, for instance, the Australian dollar," Strauss added.

The Australian dollar was trading around C$0.8103 from C$0.8039 late Wednesday.

The U.S. dollar's gains are likely to be curbed by resistance around Wednesday's high just above C$1.2400 and the greenback's high of C$1.2454 earlier in the week, Strauss said.

"Given that it is a U.S. holiday, I would be surprised if we test and break above those levels," Strauss said.

There were no significant data releases in Canada Thursday.

Thursday evening, Bank of Canada Deputy Governor Pierre Duguay will speak in Pictou, N.S., on "Fostering Financial System Stability."

On Friday, current account data for the third quarter will be released, along with average weekly wage data for September and industrial product and raw material price index data for October.

These are the exchange rates at 9:52 a.m. EST (1452 GMT), 8:00 a.m. EST (1300 GMT), and late Wednesday.

   USD/CAD     1.2356     1.2340     1.2265 
   EUR/CAD     1.5926     1.5932     1.5841 
   CAD/JPY      77.37      77.20      78.13 

-By Don Curren; Dow Jones Newswires;416-306-2020; don.curren@dowjones.com

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(END) Dow Jones Newswires

November 27, 2008 09:54 ET (14:54 GMT)


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