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Loonie Sees Little Change Against Other Majors [USD/CAD]
4/22/2008 4:06:08 PM The Canadian dollar saw little-change versus other majors on Tuesday as the Bank of Canada said that it lowered its target for the overnight rate by 50 basis points to 3 percent. The Canadian currency was little changed amid volatile trading against its U.S. counterpart and also little-moved against the euro and yen.

Citing concerns about the impact of the slowdown in the U.S. economy, the Bank of Canada announced on Tuesday that it decided to lower its benchmark interest rate by half a percentage point. The interest rate cut was widely anticipated by analysts.

This marks the bank`s second consecutive 50 basis point rate cut. In its accompanying statement, the bank said that global economic growth has weakened due to the sharp slowdown in the U.S. economy and ongoing dislocations in global financial markets.

The loonie and greenback were little-changed in the afternoon amid choppy trading. The currencies have been range-bound since late last week and moved at 1.0072 in the mid-afternoon. Traders considered a report from the National Association of Retailers showing that March sales of previously owned homes fell 2 percent to 4.93 million.

The loonie edged lower against the euro on Tuesday, continuing its recent weakness. The Canadian currency has been trending down since late last week and moved at 1.6103 in the mid-afternoon. Although there was no major economic news planned for the day, traders considered comments from European Central Bank officials.

The loonie was range-bound throughout the day with the Japanese yen. The pair moved at 102.21 in the mid-afternoon. Traders considered industry data showing that Japanese supermarket sales grew 1.4% annually in March.