The loonie just crashed below 71 cents – with more pain to come

Click to play video: 'Loonie continues to spiral downwards'
Loonie continues to spiral downwards
Loonie continues to spiral downwards – Jan 6, 2016

The Canadian dollar slid briefly below the 71-cent mark on Wednesday morning, a value not seen since the early days of 2003.

To put that into perspective, Finding Nemo was still in movie theatres and Jean Chrétien was the Prime Minister.

The renewed pressure is coming from – what else – sliding oil prices, which have directly fed into the loonie’s 23 per cent fall against the U.S. dollar since January 2014. Oil was down more than 3 per cent Wednesday morning, to $34.83 a barrel (U.S.).

Lower oil prices are being blamed on weak Chinese economic data released this week, which could add to a global supply glut that’s responsible for crude’s sharp collapse.

The loonie hit 70.90 cents U.S. shortly after 8 a.m. EST before recovering to a shade above 71 cents. Experts suggest the Canadian dollar is poised to remain under pressure.

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“The Canadian dollar is liable to weaken further in 2016,” Scotiabank experts said this week, “although a lot of bad news is already factored into the exchange rate.”

READ MORE: ‘The plunging loonie is juicing food costs’

A dicey domestic economy that’s being battered by a broader downturn for basic commodities because of weakening demand abroad (namely from China) is also weighing on the currency, Scotia said in an updated forecast.

“Low oil prices and sluggish domestic growth will count against the CAD in the coming year.”

The bank’s experts suggest the loonie may bottom out at between 69 cents through 2016.

WATCH: Food prices are rising quickly. As Reid Fiest reports, there’s no avoiding the fact it’s going to cost us all a lot more to eat.

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