Canadian Dollar Hits Lowest Level Since August as Bond Yields Widening

The Canadian dollar continued its downward trend on Friday, falling to its weakest intraday level since August 7. The loonie was trading at 1.4010 per US dollar, or 71.38 US cents, marking a 0.1 percent decline.

This marks the currency's eighth straight daily decline, which would be the longest such streak since May. For the week, the Canadian dollar is down 1 percent due to the widening gap between US and Canadian bond yields.

According to Scotiabank strategists Shaun Osborne and Eric Theoret, 'wider front-end US-Canada yield spreads account for much of the CAD's slippage over the past few days.'

The 2-year Canadian yield was trading about 142 basis points below the US equivalent, marking its widest gap since July 28.