Yesterday saw the Canadian dollar fall to a four-year low against the US dollar as oil prices continued to tumble and investors awaited potential stimulus from the Bank of Canada to offset the economic impact of the coronavirus outbreak. The Loonie also weakened against the GBP, which was not performing too well itself over the course of the trading day. However, GBP received a swing of support following another announcement by the UK government that support is on the way for renters and freelance workers. The categories of individuals had not previously been mentioned in the previous £330 billion stimulus package, which led markets to worry about the future of the UK economy and its workers. But following the announcement from Rishi Sunak last night, GBP was trading higher.
Canada Still Suffers From Low Oil Prices and Coronavirus Fears as Canadian PM Reveals Support Stimulus
In Canada, the economy remains under threat. The Canadian dollar took a tumble yesterday which saw the currency drop to a four-year low against the US dollar. This came as oil prices fell and investors fretted over the potential stimulus from the Bank of Canada to ease the economic impact of the coronavirus outbreak. Canada and the United States are working on a deal to close their joint border to non-essential travel as part of the fight against a coronavirus outbreak, a Canadian government source said.
The price of oil, one of Canada’s major exports, fell to a 17-year low as travel and social lockdowns sparked by the coronavirus epidemic knocked the outlook for demand. US crude oil futures were down 9% at $24.52 a barrel. Global stocks stumbled back into the red as fears over the coronavirus fallout eclipsed large-scale support measures rolled out by policymakers around the globe.
Meanwhile, Wednesday saw the Canadian Prime Minister Justin Trudeau announce additional economic measures to help Canadians affect by the virus. The government announced that it will spend up to £82 billion, including $27 billion in direct support for Canadian workers and businesses. This move helped CAD find some support as it helped to reassure CAD investors a little.
UK Government Pledges More Support to Help UK Citizens
Across the pond and into the UK, the government announced another stimulus package to help UK businesses and individuals yesterday. The additional support package gave reassurance to individuals renting their homes and self-employed, freelance workers who had questioned their support and income up ahead as business across the world takes a dip amid the crisis. The announcement of the stimulus helped the pound find some support after previously faltering on worries of how the government would build on their previous support release.
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