- July 14, 2018
- Posted by: Trading
- Category: News
* Canadian dollar at C$1.3159, or 75.99 U.S. cents
* Loonie falls 0.6 percent for the week
* Price of U.S. oil rises nearly 1 percent
* Bond prices higher across the yield curve
By Fergal Smith
TORONTO, July 13 (Reuters) – The Canadian dollar was little changed against its U.S. counterpart on Friday as oil prices rose, but for the week the was on track to fall 0.6 percent after broader gains for the greenback offset a Bank of Canada interest rate hike.
At 3:30 p.m. EDT (1930 GMT), the Canadian dollar CAD=D4 was trading near unchanged at C$1.3159 to the greenback, or 75.99 U.S. cents.
The U.S. dollar faded from a two-week peak which was tied to news of a record Chinese trade surplus that may fuel U.S.-China trade tensions and that briefly spurred safe-haven bids for the greenback. U.S. dollar had its run earlier in the week,” said Mark McCormick (NYSE:), North American head of FX Strategy at TD Securities. “I think markets now are consolidating a bit, volumes are probably a little bit lower, people are probably taking some positions off.”
Canada exports many commodities, including oil, and runs a current account deficit, so its economy could be hurt if the flow of trade or capital slows.
The country has its own trade dispute with the United States and is also in slow-moving talks to revamp the North American Free Trade Agreement (NAFTA).
Still, the Bank of Canada raised interest rates on Wednesday for the fourth time since July 2017. The central bank is hoping higher oil prices can cushion the impact global trade tension has on exports and investment. crude oil futures settled nearly 1 percent higher at $71.01 a barrel.
Speculators have raised bearish bets on the Canadian dollar to the most since June 2017, data from the U.S. Commodity Futures Trading Commission and Reuters calculations showed. As of July 10, net short positions had increased to 52,887 contracts from 49,448 a week earlier.
Italy will not ratify the European Union’s free trade agreement with Canada, Deputy Prime Minister Luigi Di Maio said on Friday, although Canadian officials played down the threat to the accord, which mostly took effect last year. exporters are diversifying international operations and are more optimistic about the near-term outlook, Export Development Canada’s Mid-Year Trade Confidence Index showed.
Canadian government bond prices were higher across the yield curve in sympathy with U.S. Treasuries. The 10-year gained 11 Canadian cents to yield 2.138 percent.
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