* Canadian dollar at C$1.0879 or 91.92 U.S. cents
* Bond prices mixed across the maturity curve
(Adds details, quotes, updates prices)
By Leah Schnurr
TORONTO, May 6 The Canadian dollar shrugged off
mixed domestic trade data and strengthened to its highest level
against the greenback in nearly a month on Tuesday as its U.S.
counterpart weakened broadly.
With the gain, the loonie also broke out of its recent
trading range. The currency has been comfortable trading around
either side of C$1.10 the past few weeks, but Tuesday's action
pushed it into the high C$1.08s.
Even data that showed Canada posted a smaller-than-expected
trade surplus in March did not clip the loonie's wings. The
surplus fell to C$79 million ($72.06 million) as exports fell
and imports rose. Still, February's surplus was revised sharply
higher to C$847 million from the C$290 million initially
The U.S. dollar was the focus in currency markets after
bullish European data prompted investors to look past recent
signs of U.S. economic improvement and sell the greenback. The
U.S. dollar was down 0.5 percent against a basket of currencies
"All year, it's been the story that the Canadian dollar has
been weak, weak, weak, but a lot of the other currencies have
actually been strong against the U.S. dollar," said Camilla
Sutton, chief currency strategist at Scotiabank in Toronto.
"All of a sudden, I think we have right now a really broad
U.S. dollar move taking place, which is bringing a strengthening
Canadian dollar on the back of it."
The Canadian dollar ended the North American
session at C$1.0879 to the greenback, or 91.92 U.S. cents,
stronger than Monday's close of C$1.0952, or 91.31 U.S. cents.
The currency hit a session high of C$1.0874, its highest level
since early April.
"Overnight moves were a bit of a momentum play," said Greg
Moore, senior currency strategist at Royal Bank of Canada in
Canadian government bond prices were mixed across the
maturity curve, with the two-year up half a Canadian
cent to yield 1.072 percent, while the benchmark 10-year
was off 2 Canadian cents to yield 2.372 percent.
(Editing by Peter Galloway)