* Canadian dollar rises 0.6% against the greenback
* Canada's annual inflation rate tumbles to 0.9%
* Price of U.S. oil climbs about 24%
* Canadian bond yields move higher across the curve
TORONTO, April 22 (Reuters) - The Canadian dollar
strengthened against its U.S. counterpart on Wednesday as a
rebound in oil prices overshadowed domestic data showing a
five-year low for inflation.
At 9:49 a.m. (1349 GMT), the Canadian dollar was
trading 0.6% higher at 1.4125 to the greenback, or 70.80 U.S.
cents. The currency, which on Tuesday hit a near three-week low
at 1.4263, traded in a range of 1.4115 to 1.4238.
The price of oil, one of Canada's major exports, was
supported by voluntary as well as the prospect of forced
production cuts to tackle a glut caused by the coronavirus
crisis.
U.S. crude prices were up 24.1% at $14.36 a barrel,
while Brent crude added 13.9% to $22.01 after slumping
earlier in the session to its lowest since 1999.
Canada's annual inflation rate tumbled to 0.9% in March as
the coronavirus crisis and an oil supply war slashed gasoline
prices, Statistics Canada said. Analysts had forecast a rate of
1.2%.
The Bank of Canada expects inflation to fall to near zero in
the second quarter. The central bank has slashed interest rates
by 150 basis points since March and has engaged in quantitative
easing for the first time, buying government bonds in large
scale.
Canadian government bond yields were higher across the curve
in sympathy with U.S. Treasuries, with the 10-year
up 2.8 basis points at 0.610%.
(Reporting by Fergal Smith)
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