Canadian Dollar Drops After BOC Poloz Comments

The Canadian dollar weakened against other major currencies in the Asian session on Tuesday after Bank of Canada's Governor Stephen Poloz hinted at the possibility of interest rate cuts.

At a speech to the House of Commons finance committee in Ottawa on Late Monday, the Bank of Canada Governor Stephen Poloz said the governing council actively discussed the possibility of further stimulus if needed. "Monetary policy has room to maneuver and we are ready to use that room," he said.

"The decision on whether to cut rates again is not one to take lightly."

Poloz also said that monetary policy is less effective when interest rates are low, and uncertainties keep the bank from cutting rates.

Crude for December delivery is down by 0.05 percent or $50.47 per barrel. The crude oil price fell on speculation the c will soon raise interest rates.

Doubts about whether OPEC and Russia will finalize a deal to curb supplies also weighed on crude oil.

Iraq said it will not join OPEC quotas as it looks to make up for years of supply interruptions brought on by war.

Monday, the Canadian dollar showed mixed trading against its major rivals. While the loonie fell against the U.S. dollar, the euro, and the Australian dollar, it held steady against the yen.

In the Asian trading, the Canadian dollar fell to 1.3363 against the U.S. dollar and 78.01 against the yen, from an early 4-day highs of 1.3278 and 78.49, respectively. If the loonie extends its downtrend, it is likely to find support around 1.35 against the greenback and 77.00 against the yen.

Against the euro and the Australian dollar, the loonie dropped to 1.4529 and 1.0169 from an early 4-day highs of 1.4443 and 1.0101, respectively. The loonie may test support near 1.47 against the euro and 1.02 against the aussie.

Looking ahead, the German Ifo business climate index for October is due to be released at 4:00 am ET.

In the New York session, U.S. FHFA house price index for August, U.S. S&P Case-Shiller house price index for August, U.S. consumer confidence index for October are slated for release.

At 10:35 am ET, Bank of England Governor Mark Carney is scheduled to testify about the economic consequences of the Brexit Vote before the House of Lords Economic Affairs Committee, in London.

At 11:30 am ET, European Central Bank President Mario Draghi is expected to speak about stability, equity, and monetary policy at the German Institute for Economic Research, in Berlin.

At 1:20 pm ET, Atlanta Fed President Dennis Lockhart is expected to speak to the Opportunity Finance Network about "Lending and Investing in Community Development" in Atlanta.