TORONTO, ONTARIO / Content Syndication Services / – The Canadian dollar weakened to a 14-month low against the U.S. dollar on Friday, bringing it close to the 70 U.S. cent mark after a sharp week of losses. The loonie traded at 1.4180 per U.S. dollar, or 70.52 U.S. cents, after touching 1.4183 intraday. The move marked its seventh straight daily decline and left it down 1.3% for the week.
The decline came as the U.S. dollar strengthened after the Federal Reserve kept its benchmark rate at 3.50% to 3.75%. Its statement said inflation remained elevated relative to the 2% goal. U.S. short-term rates remained above Canada’s policy rate. The latest figures left U.S. rates 1.25 to 1.50 percentage points above Canada’s overnight rate.
The Bank of Canada held its overnight rate at 2.25% on June 10. The Bank of Canada said the Canadian dollar had weakened against the U.S. dollar and other currencies. It also said first-quarter gross domestic product edged down 0.1%. The bank cited weak business investment, lower exports and a softer housing market. It kept the bank rate at 2.5% and the deposit rate at 2.20%.
Rate gap weighs
New domestic data added pressure to the currency. Statistics Canada reported that April retail sales rose 0.5% to C$73.03 billion. The headline gain reflected higher sales at gasoline stations and fuel vendors. Core retail sales fell 0.7%, marking a second monthly decline. That measure excludes gasoline stations, fuel vendors, motor vehicles and parts dealers.
The selloff also followed a sharp move in oil, one of Canada’s major exports. U.S. crude futures fell during the week and traded at $75.30 a barrel on Thursday. Oil prices had fallen about 9% from the previous Friday by late-week trading. Energy exports form a major part of Canada’s external sales and remain a closely watched input for the loonie.
Retail data softens
Bond markets added another pressure point. Canada’s two-year government yield fell farther below the comparable U.S. rate on Thursday. The gap reached 137 basis points, its widest level since May 2025. The spread showed how fixed-income markets priced the difference between U.S. and Canadian short-term rates. Canada’s 10-year government yield stood at 3.392% on Friday.
The latest official daily exchange-rate data placed one U.S. dollar at C$1.4171 on Friday. That translates to about 70.57 U.S. cents for one Canadian dollar. The 70-cent threshold corresponds to about C$1.4286 per U.S. dollar. For consumers and companies, a weaker loonie raises the Canadian-dollar cost of U.S.-priced travel, imports and debt payments.