CANADA FX DEBT-C$ clings to most of prior day’s gains as oil rallies By Reuters


© Reuters. CANADA FX DEBT-C$ clings to most of prior day’s gains as oil rallies

(Adds strategist quotes and details on activity; updates prices)

* Canadian dollar dips 0.1 percent against the greenback

* Price of U.S. oil rises 2.3 percent

* Canada’s Q3 current account deficit narrows to C$10.34 billion

* Canadian bond prices rise across the yield curve

By Fergal Smith

TORONTO, Nov 29 (Reuters) – The Canadian dollar edged lower against its U.S. counterpart on Thursday but held on to most of its gains from the day before as oil prices rallied and data showed that Canada ran a smaller-than-expected current account deficit in the third quarter.

The price of oil, one of Canada’s major exports, rose after industry sources said Russia had accepted the need to cut production, together with the Organization of the Petroleum Exporting Countries ahead of its meeting next week. crude oil futures settled 2.3 percent higher at $51.45 a barrel.

“It does appear as if for crude, specifically, that we have found a bit of a floor,” said Shaun Osborne, chief currency strategist at Scotiabank. “I think that should be positive for the CAD in the near to medium term.”

Canada’s current account deficit narrowed to C$10.34 billion in the third quarter from a revised C$16.68 billion deficit in the second quarter, Statistics Canada said. Analysts had forecast a deficit of C$11.50 billion. improvement reflected better prices for Canada’s exports that have since “melted away,” said Avery Shenfeld, chief economist at CIBC Capital Markets.

At 4:20 p.m. (2120 GMT), the Canadian dollar CAD=D4 was trading 0.1 percent lower at 1.3285 to the greenback, or 75.27 U.S. cents. The currency traded in a range of 1.3254 to 1.3314.

On Wednesday, the hit a five-month low intraday at 1.3360 before rallying on comments from Federal Reserve Chairman Jerome Powell that were seen as dovish by some investors.

“I would expect (Canadian) interest rate differentials to narrow in the next few months against the U.S. dollar, (which is) a bit more supportive of the CAD,” Scotiabank’s Osborne said.

The Bank of Canada hiked interest rates last month for the fifth time since July 2017 after an agreement among Canada, the United States and Mexico on a new North American trade pact reduced uncertainty for Canada’s economy.

But a day before the countries are due to sign the agreement, negotiators are still thrashing out what exactly they will be putting their names to, officials said. government bond prices were higher across the yield curve, with the two-year up 4 Canadian cents to yield 2.188 percent and the 10-year rising 20 Canadian cents to yield 2.304 percent.

The 10-year yield touched its lowest intraday since Sept. 10 at 2.289 percent.

Canada’s gross domestic product data for the third quarter is due on Friday.

Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.



Source link



Leave a Reply

error: Content is protected !!