Today’s savage sell-off in the oil futures market had a sizable impact on commodity-price-sensitive currencies like the CAD, AUD and NZD.
Crude oil futures began to sell-off sharply on Wednesday morning due to a larger-than-forecast U.S crude oil inventory reading (8.2 million barrels) for last week.
The unexpected news caused the price of oil to drop from $52.79 to $50.05 (-5.0%). This was the largest one-day drop since July 7, 2016.
The Aussie dollar sustained the heaviest losses of the three major commodity currencies. By the end of the New York FX session, the AUD/USD dropped 0.78% to a 37-day low of 0.75259.
The oil crash caused the Canadian dollar to lose 0.60% on Wednesday. By 2:00 p.m. EST, the USD/CAD currency pair had rallied all the way to 1.35 - a high for 2017. This exchange rate was last seen on December 30, 2016!
New Zealand’s currency got away with the smallest losses today, dropping about 0.58% against the USD and closing at a 2-month low of 0.69050. However, this is the 6th consecutive day of losses for the New Zealand dollar since the beginning of March! The NZD has not had a single winning day this month.
At press time, the NZD/USD currency pair is only about 0.62% away from breaking under the lows from December of 2016:
Dollar photo by Kurtis Garbutt
