July 27, 2020 / 7:33 PM / 7 days ago

CANADA FX DEBT-C$ gains along with higher oil prices as greenback sinks

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    * Canadian dollar rises 0.4% against the greenback
    * Loonie trades in a range of 1.3354 to 1.3413
    * Price of U.S. oil increases 0.8%
    * Canadian government bond yields edge higher
    * Canada's 10-year yield hits its lowest since June 15 at

    By Fergal Smith
    TORONTO, July 27 (Reuters) - The Canadian dollar
strengthened against its U.S. counterpart on Monday as oil
prices rose and the greenback again declined against a basket of
major currencies, with the loonie approaching a six-week high
notched last week.
    The U.S. dollar        fell to its lowest level since June
2018, weighed by deteriorating U.S.-China relations and concerns
about the U.S. economy as COVID-19 infections climbed.
    "We have seen U.S. dollar weakness pretty much across the
board," said Rahim Madhavji, president at KnightsbridgeFX.com.
"At the end of the day weakness in the U.S. dollar is typically
a risk-on event for the market."    
    Wall Street's main indexes were higher as investors
monitored progress in government stimulus efforts, while the
price of oil       , one of Canada's major exports, settled 0.8%
higher at $41.60 a barrel.
    The Canadian dollar        was trading 0.4% higher at 1.3366
to the greenback, or 74.82 U.S. cents. The currency traded in a
range of 1.3354 to 1.3413.
    Last Thursday, the loonie touched its strongest intraday
level since June 10, at 1.3347.
    Data on Friday showed that speculators have reduced their
bearish bets on the loonie to the lowest point since mid-March.
    Canadian government bond yields edged higher across much of
the curve on Monday along with higher yields on U.S. Treasuries.
    The 10-year yield             was up 0.7 basis point at
0.514, having earlier touched its lowest intraday level since
June 15 at 0.482%.
    The Federal Reserve at the close of its two-day policy
meeting on Wednesday could confirm recent hints about the
benefits of an average inflation target, which would allow rates
to stay lower for longer.             
    Canada's GDP report for May is due on Friday.

 (Reporting by Fergal Smith
Editing by Nick Zieminski and Leslie Adler)
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