Loonie loses ground over debt worries in the U.S. and Europe

Jittery investors punished the Canadian dollar on Monday morning, sending it lower as they fled towards safe havens such as bullion. Ironically, the greenback strengthened against the loonie, even as the market fretted about the drawn-out debt-ceiling debate that has engulfed Washington. The Canadian dollar fell 0.55 of a cent to 104.24 cents U.S. Traders were also anxious about debt levels in Europe, even after the Friday release of the results of stress tests of the continent’s banks that were supposed to reassure the market. Those tests, though, didn’t consider a scenario in which a eurozone country defaults, something that might very well happen in Greece, experts say.

Toronto Star