The Canadian dollar has fallen to its lowest level of the year.
On June 8, the Loonie ended trading at 71.67 cents U.S., its lowest point of 2026.
Economists say the Canadian currency is weakening due to several factors that include the price of gold slumping and the economy entering a recession.
The loonie is currently the weakest reserve currency among the world’s leading industrialized nations. The U.S. dollar, euro, and Japanese yen are each outpacing the Canadian dollar.
Economists point out that the Canadian dollar now has a stronger relationship with the price of gold than the price of crude oil.
That’s hurting the loonie as the price of gold is down 20% from its all-time high of about $5,400 U.S. an ounce reached in January of this year.
At the same time, the Canadian economy is now in a recession after registering no growth in the last two quarters, a situation that is also weighing on the currency.
There is also growing economic uncertainty as the Canada-U.S.-Mexico Agreement on Trade is renegotiated this summer.
The loonie hit a year-to-date high of 74.1 cents U.S. in late January of this year but has been struggling ever since.
