Wednesday November 7, 2007 - 22:55:17 GMT
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Reuters - www.reuters.com
Forex Market News - UPDATE 1-Canadian dollar tumbles in late afternoon
Wed Nov 7, 2007 4:04pm EST
TORONTO, Nov 7 (Reuters) - The Canadian dollar fell sharply from record highs against the U.S. currency late in the North American session on Wednesday and was headed for a lower close as oil prices dropped from their all-time peak.
The Canadian dollar fell to US$1.0743, valuing a U.S. dollar at 93.08 Canadian cents, from mid-afternoon levels around US$1.0869, or 92.00 Canadian cents.
That marked a huge turnaround from overnight levels when the Canadian dollar shot to US$1.1039, its highest level since the late 1800s.
A portion of the currency's overnight gain was supported by a charge in oil prices to above $98 a barrel, but when prices turned negative during the North American session, the Canadian dollar went along for the ride.
The Canadian dollar broke through parity with the greenback in September for the first time since 1976 and sparked speculation that it is overvalued at current levels and due for a pullback.
U.S. dollar weakness also supported the overnight rise in the Canadian currency after comments from a Chinese official stoked fears the central bank of the world's fourth-largest economy would reduce its holdings of U.S. assets. (Reporting by Frank Pingue; Editing by Frank McGurty)
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