05.06.201405:55:02UTC+00Canadian dollar declines to 4-week low

The Canadian dollar dropped to four-week low following the Bank of Canada maintained rates and reiterated concern the low inflation and frail exports obstructed the country's economy.

The currency tumbled versus most of its major counterparts following BOC Governor Stephen Poloz kept the benchmark interest rate at 1% and repeated future moves could be up or down depending on the economic figures.

Loonie has been the worst performer among Group of 10 peers versus the greenback in the last 12 months as the central bank started echoing concern about persistently low inflation and the significance of a weaker Canadian dollar to amplify the exports.

“As long as the economy is soft, and as long as there’s uncertainty about U.S. growth, and as long as exports remain tepid, I think the Bank of Canada is going to be very careful not to say or do anything to trigger a strengthening in the currency. The bank is likely to err on the side of caution,” said Emanuella Enenajor, Economist at Bank of America Corp.

The loonie decreased 0.3% to C$1.0940 per US dollar at 5:05 p.m. in Toronto. It hit the weakest level since May 6. One Canadian dollar is equal to 91.41 US cents.