- October 15, 2018
- Posted by: Trading
- Category: News
* Canadian dollar rises 0.1 percent against the greenback
* Price of U.S. oil rises 0.5 percent
* Resales of Canadian homes dip 0.4 percent in September
* Canada-U.S. 10-year spread widens by 2.5 basis points
TORONTO, Oct 15 (Reuters) – The Canadian dollar edged higher against its U.S. counterpart on Monday ahead of the release of a business survey by the Bank of Canada, as the price of oil was boosted by growing tensions between Western powers and Saudi Arabia.
The price of oil, one of Canada’s major exports, rose as tension over the disappearance of a prominent Saudi journalist stoked supply worries, although concerns over the long-term demand outlook dragged on sentiment. crude prices were up 0.5 percent at $71.71 a barrel.
The Bank of Canada’s autumn issue of the Business Outlook Survey is due for release at 10:30 a.m. (1430 GMT).
The data could help guide expectations for the Bank of Canada interest rate decision next week. Although some responses to the survey could have been collected before a recent deal to revamp the North American Free Trade Agreement reduced uncertainty for the country’s economy.
Money markets see a nearly 90-percent chance of a rate hike at the Oct. 24 rate announcement.
Resales of Canadian homes dipped 0.4 percent in September from August, the first decline since April, the Canadian Real Estate Association said. 9:29 a.m. (1329 GMT), the Canadian dollar CAD=D4 was trading 0.1 percent higher at 1.3013 to the greenback, or 76.85 U.S. cents. The currency traded in a narrow range of 1.3005 to 1.3033.
Last week, the declined 0.6 percent as worries over higher bond yields and the impact of trade tariffs contributed to volatility in global financial markets.
Still, speculators have cut bearish bets on the Canadian dollar to the lowest since March, data from the U.S. Commodity Futures Trading Commission and Reuters calculations showed on Friday. As of Oct. 9, net short positions had decreased to 12,145 contracts from 18,484 a week earlier.
Canadian government bond prices were mixed across a flatter yield curve, with 10-year rising 12 Canadian cents to yield 2.485 percent.
The gap between Canada’s 10-year yield and its U.S. counterpart widened by 2.5 basis points to a spread of 66.7 basis points in favor of the U.S. bond.
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