The loonie fell briefly below parity but then moved back to positive territory compared to the greenback ahead of the opening of North American stock markets on Monday.

After falling as low as 98.84 cents US earlier in the morning, the Canadian dollar climbed to 100.19 cents US.

The fluctuations come ahead of what is expected to be a tumultuous trading day as European markets react to Europe's ongoing debt problems and worries that Greece will default on its loans.

The uncertainty has led investors to turn to the greenback as a safe haven currency, which accounts for the fluctuations in the loonie.

BNN's Michael Kane said world markets were reacting to North American declines recorded on Friday after Euro markets had closed.

"The world stock markets are looking shaky this morning," Kane told CTV's Canada AM, noting that Friday's 2.6 per cent plunge in major industries on Wall Street was being echoed in world markets.

"Tokyo is down 2.3 per cent, Hong Kong fell 4.3 per cent, European markets are down in the range of 2.5 to 4.4 per cent and shares of French banks BNP Paribas, Credit Agricole and Societe Generale plunging today on worries their rating might be cut by Moody's Investors Service," Kane said.