The Canadian dollar was lower against its U.S. counterpart on Tuesday as weaker prices for oil, a major Canadian export weighed.
Oil prices surrendered early gains Tuesday amid persistent concerns that rising U.S. oil output is threatening to derail efforts by other major producers to restrict supply in a bid to rebalance the global market.
Traders were looking ahead to oil inventory data from industry group the America Petroleum Institute later in the trading day.
Canada is a major producer of commodities, including oil and metals.
The Canadian dollar has been one of the worst performers against the greenback so far this year, weakening steadily since mid-April and falling to a 14-month through last week, before recovering slightly.
The loonie has been pressured lower by a combination of lower commodity prices, concerns about a possible renegotiation of the North American Free Trade Agreement, and worries over how trouble at alternative lender Home Capital could affect the country’s real estate market.
Home Capital Group said on Tuesday that a third party, which it did not name, intends to buy up to C$1.50 billion ($1.10 billion) in mortgages.
Home Capital, Canada’s largest non-bank lender is facing a regulatory probe for misleading investors, leading to an exodus of customer deposits.
Meanwhile, data on Tuesday showed that the value of Canadian building permits unexpectedly declined in March for the second month in a row, falling by 5.8%. Economists had expected an increase of 5.5%.
The greenback remained broadly stronger, with the U.S. dollar index, which measures the greenback’s strength against a trade-weighted basket of six major currencies, up 0.35% to 99.38.