Prolonged tensions between Russia and Ukraine have added risks in the market to the point of pushing US dollar safe-haven demand higher, causing the loonie dollar to continue to be limited even as crude oil prices continue to soar.
Towards the opening of the European session, the Canadian dollar traded 0.1% lower against the US dollar at around 1.2750.
Investors continue to seek safe-haven assets as Russia is expected to invade Ukraine on 16 February. Although it was only speculation by the Western media but the President of Ukraine, Volodymyr Zelenskiy urged his people to fly the country’s flag and sing again the national anthem on that date.
These concerns also pushed world crude oil prices to a 7 -year high. However, Canadian dollar trading was only able to get some support from the strengthening.
Even so, investors are still expecting the loonie dollar to shine more this week as Canadian inflation data to be published on Wednesday is expected to show an improvement.
If the figures released are positive, it will further strengthen market confidence that the Central Bank of Canada (BOC) will raise interest rates in March in line with the Federal Reserve (Fed).
