The Canadian dollar rose as the North American stocks rallied after the hostile bid for the Potash Corp. by the BHP Billiton Ltd., which increased the appeal of the growth-linked assets.
The future for crude oil, Canada’s main export, slid as much as 2.6 percent to $73.83 on NYMEX, the lowest level since July 7th. The slump of the oil prices was overshadowed by the rally of the stocks after the BHP offered $130 in cash for each Potash share ($40 billion for the whole deal). The Standard & Poor’s 500 Index rose 0.2 percent after it declined earlier.
The investors reduced bets that the Bank of Canada will raise the interest rates as the US economy shows the signs of the weakness. The forecasts delayed the parity of the Canadian dollar with its US counterpart till 2011.
USD/CAD traded at 1.0268 today as of 23:17 GMT after it opened at 1.0319. EUR/CAD fell to 1.3189 from the opening level of 1.3295.
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