Canadian Dollar Falls Ahead Of GDP Data

The Canadian dollar declined against its most major rivals in European deals on Friday, as traders focus on the release of nation's GDP data for November, due later in the day.

The gross domestic product is seen flat on month, after growing 0.3 percent in October. On year, the economic growth is expected to be 3.0 percent, following a 5.0 percent rise in the previous.

The sharp decline in oil prices in recent months is expected to slowdown Canada's economic growth.

The Bank of Canada last week cut its benchmark interest rate to 0.75 percent from 1.0 percent, due to the implications of lower oil prices. Since the country relies heavily on oil exports for growth, the rate cut would help to offset the "instability" caused by plunging oil prices, the BoC governor Stephen Poloz said.

European markets retreated after the release of weak inflation data from Eurozone. Traders await U.S. advance fourth quarter GDP report and consumer sentiment for further direction.

The loonie fell to nearly a 6-month low of 92.78 against the yen, down from 93.71 hit late New York Thursday. The next possible downside target for the loonie-yen pair is seen around the 91.00 mark.

Data from the Ministry of Internal Affairs and Communications showed that Japan's consumer prices rose 2.4 percent on year in December, topping expectations for 2.3 percent and unchanged from November.

Core CPI, which excludes the volatile costs of food, added 2.5 percent.

The loonie hit 1.4392 against the euro, its lowest since December 17, 2014. At yesterday's close, the pair was valued at 1.4280. The loonie is likely to challenge support around the 1.45 region.

Eurozone harmonized consumer prices decreased for the second straight month in January and marked the biggest fall since 2009, data from Eurostat showed.

The harmonized index of consumer prices fell 0.6 percent year-on-year in January, a similar rate of decline was last seen in July 2009.

The loonie that closed yesterday's trading at 1.2615 against the greenback edged down to 1.2674. Next key support for the loonie may be located near the 1.276 area.

Although the loonie fell to 0.9844 against the aussie at 3:30 am ET, it climbed in a short while and stabilised shortly thereafter. The pair ended yesterday's deals at 0.9793.

Looking ahead, U.S. advanced GDP data for fourth quarter and Reuters/University of Michigan's final consumer sentiment index for January are due in the New York session.