(The Canadian Press) TORONTO – The Canadian dollar was lower Wednesday as risk appetite faded amid concerns about China's property market and traders awaited the next interest rate announcement from the Bank of Canada, scheduled for mid-morning.
The loonie fell 0.34 of a cent to 96.85 cents US. The central bank is widely expected to leave its key rate unchanged at 1.0% until well into 2014.
``Risky assets have been under extreme pressure,'' observed Mark Chandler, Head of Canadian FIC Strategy at RBC Dominion Securities.
``The increase in Chinese money-market rates (as the monetary authorities leave the system a bit 'cash dry') has taken short-term rates higher.''
The greenback rose amid speculation that the People's Bank of China may tighten monetary policy to cool a hot property market.
China reported Tuesday that house prices surged in some cities including Guangzhou/Shenzhen where prices jumped 20% year over year, Shanghai jumped 17% year over year while Beijing was up 16% year over year.
The PBoC reported Wednesday that outstanding real estate loans are up 19% from a year ago.
There was also a report that the amount of bad loans written off by China's largest banks swelled in the first half of the year.
The December crude contract on the New York Mercantile Exchange dropped $1.55 to US$96.75 a barrel, its lowest level since late June as ample supplies and a slowdown in U.S. hiring suggest subdued demand.
The U.S. Energy Department will release crude stockpile figures for last week later Wednesday and a three million barrel increase is expected.
---
TAKE BACK YOUR PORTFOLIO
When times are tough, the smart money focuses on cash-rich, undervalued stocks. With 25 years of market experience, Danny Deadlock's Vulture Capitalist system alerts Ticker Trax insiders to undiscovered gems on the upswing.
Click here to get TickerTrax alerts.