Canadian Dollar Weakens On Falling Oil Prices

The Canadian dollar slipped against its major counterparts in European deals on Tuesday, as oil prices declined after Saudi Arabia and Iran dampened prospectus of any deal being reached to limit production when the OPEC meets Wednesday in Algiers.

Crude oil for November delivery fell $0.58 to $45.34 per barrel.

The Saudi Energy Minister Khalid al-Falih said the talks would be constructive, as the rift between the the kingdom and rival Iran acted as hindrance to any potential deal at Algeria.

"We are optimistic about the fundamentals," Khalid al-Falih told reporters in Algiers.

"Rebalancing is here but taking slower than what we had hoped," he added.

Iranian oil minister Bijan Namdar said that he had come for the IEF and to have a consultative informal meeting in OPEC to exchange views.

"It is not the time for decision-making," he added.

Falling oil prices also triggered risk aversion, with banking and financial shares pacing the decline.

The loonie has been trading lower against its major counterparts in the Asian session.

The loonie declined to 1.0157 against the aussie, its lowest since December 28, 2015. The next possible support for the loonie may be found around the 1.03 mark. The pair finished yesterday's trading at 1.0096.

The loonie eased back to 75.88 against the Japanese yen, down from a high of 76.69 hit at 2:10 am ET. The loonie is heading to pierce its early more than 4-year low of 75.41. If the loonie-yen pair extends slide, 73.00 is possibly seen as its next support level.

The minutes from the Bank of Japan's July 28-29 meeting showed that the members of the board judged that the county's economic recovery is on track, with the inflation outlook remaining slightly negative due to soft energy prices.

At the meeting, board decided to hold its target of raising the monetary base at an annual pace of about JPY 80 trillion. Also, the board voted to maintain a negative interest rate of -0.1 percent.

The loonie reversed from an early high of 1.4803 against the euro, falling back to 1.4876. Further downtrend may see the loonie breaching its early Asian session's 5-1/2-month low of 1.4925. If the loonie extends slide, it may locate support around the 1.51 area.

Data from the European Central Bank showed that Eurozone money supply growth accelerated in August and loans to households increased at a steady pace.

The broad monetary aggregate M3 climbed 5.1 percent year-on-year in August, faster than the 4.9 percent increase seen in July.

The loonie retraced some of its early gains against the greenback, with the pair trading at 1.3213. This may be compared to previous session's 6-month low of 1.3275. On the downside, the loonie may find support around the 1.35 region.

Looking ahead, U.S. S&P/Case-Shiller home price index for July, consumer confidence, Markit's preliminary services PMI and Richmond Fed manufacturing index for September are set for release in the New York session.

At 11:15 am ET, Federal Reserve Governor Stanley Fischer will deliver a speech titled "Why Study Economics?" at the Howard University Economic Convocation in Washington DC.