Loonie Weakens as Oil Prices Fall Amid Diplomatic Hopes

The Canadian dollar weakened against the US dollar on Tuesday as oil prices fell following comments from Qatari and US officials that raised hopes for a diplomatic resolution to the Iran war.

Oil prices dropped by 5.7% to $75.80 a barrel, which negatively affected the Canadian currency. The loonie traded 0.2% lower at 1.4070 per US dollar, or 71.07 US cents.

The Canadian trade surplus reached a four-year high of C$3.86 billion ($2.75 billion) in June, driven by a weaker Canadian dollar that increased the value of exports and imports. Analysts had forecasted a surplus of C$3 billion.