Canadian dollar is sinking before Janet Yellen even takes the stand

TORONTO — The Canadian dollar was lower Tuesday as the American currency strengthened ahead of the first of two days of testimony from U.S. Federal Reserve chairwoman Janet Yellen.
The loonie declined 0.4 of a U.S. cent 79.12 cents US.

Yellen will update Congress on the economy and monetary policy. Traders also looked for any indication of when the central bank might move on raising interest rates. There has been much speculation the bank could move on rates as early as June.

Stephen Poloz will also speak today at 2 p.m. and if trader perceive a dovish tone from the Bank of Canada Governor it could push the loonie down further.

On the economic calendar, investors were set to digest the latest reading on American consumer confidence. The U.S. Conference Board’s index is expected to step back to 99 versus 102.9 last month.

Oil prices ticked higher after four days of losses triggered by data last week showing significant buildups in U.S. crude inventories to 80-year highs. On Tuesday, the April crude contract gained 21 cents to US$49.66 a barrel.

Metals were mixed with March copper up three cents to US$2.63 a pound while April gold faded $1.90 to Us$1,198.90 an ounce.

Meanwhile, Greece’s left-wing government will deliver a list of reforms Tuesday to debt inspectors for final approval of extended rescue loans. Greece and its bailout creditors reached a tentative agreement last week to extend a rescue loan program by four months to avoid the risk of a Greek default and exit from the euro currency. The reforms are expected to include tax evasion curbs, corruption, smuggling and excessive bureaucracy as well as poverty caused by a six-year recession.

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