Canadian Dollar Dips As Agriculture, Energy Affected by CN Rail Disruption

The Canadian dollar is trading slightly lower against multiple currency rivals on Tuesday following recent wholesale data. The loonie has been under threat in recent sessions as several Canadians industries are crippled by a work stoppage at the nation’s largest rail company, which has impacted the agriculture and energy sectors.

Thousands of Canadian National Railway workers walked off the job over disputes regarding working conditions and benefits for more than 3,000 conductors and yard operators. This is one of the largest nationwide labor strikes in recent history.
The CN Rail affair is already wreaking havoc in several key markets for the country, especially aluminum, crude oil, and wheat exports that are bound for the US and elsewhere around the world. In addition to affecting shipments, the strike is causing a freight traffic clog at the US-Canada border. Thousands of households in Ontario and British Columbia could be without heat due to the shortages of propane.
Financial analysts are already warning that the week-long strike could trim economic growth by as much as 0.25% to 1.3% if it extends into December. Federal lawmakers could intervene after December 5.
The labor stoppage comes at a time when the country’s agricultural and manufacturing industries have been paralyzed by global trade uncertainty, higher input costs, and low commodity prices.
December West Texas Intermediate (WTI) crude futures tacked on $0.25, or 0.43%, to $58.25 per barrel on the New York Mercantile Exchange. Crude is Canada’s largest export, so any significant event or movement in the energy commodity can affect the economy.
On the data front, national wholesale sales rose 1% in September, up from a 1.2% drop in August, according to Statistics Canada. This beat market forecasts of a 0.4% jump. The gains were seen in five subsectors, including machinery, equipment, and building materials and supplies. But the automobile and motor vehicle parts subsectors recorded a contraction.
Overall, this is the 14^th consecutive quarterly increase.
The USD/CAD currency pair rose 0.05% to 1.3307, from an opening of 1.3301, at 12:51 GMT on Tuesday. The EUR/CAD edged up 0.08% to 1.4659, from an opening of 1.4646.

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Original from: www.earnforex.com