Friday saw the Canadian dollar drop in value one day after performing strongly on the back of the euro zone debt deal's announcement prompted a bullish market atmosphere, Bloomberg reports.
The loonie drove to its highest level in more than one month on Thursday when held against the U.S. dollar. The nation's monetary unit also is heading toward a fourth straight weekly gain against its southerly rival. The U.S. dollar has dropped in value against all of its top 16 rival currencies.
Earlier this week, the Bank of Canada downgraded the country's growth outlook, which prompted the loonie's poor performance when compared with other major monetary units.
"The Bank of Canada was a little more dovish than people were expecting," senior currency strategist Eric Viloria with Gain Capital Group in New York told Bloomberg. "They pulled back on growth expectations. The Canadian dollar is making a little bit of a corrective move."
Disappointing results of an Italian bond sale also added to dashed hopes about the prospects of the sovereign debt crisis being reined in, according to Reuters. Italy is one of the region's core nations threatened by the debt scourge.
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