September 23, 2019 / 8:14 PM / 25 days ago

CANADA FX DEBT-Loonie turns higher as data buys time for BoC to stay on hold

 (Adds dealer quotes and details throughout, updates prices)
    * Canadian dollar trades rises 0.1% against the greenback
    * Canadian wholesale trade increases by 1.7% in July 
    * Price of U.S. oil gains nearly 1%
    * Canada's 10-year yield touches a near 2-week low at 1.339%

    By Fergal Smith
    TORONTO, Sept 23 (Reuters) - The Canadian dollar edged
higher against the greenback on Monday, clawing back its earlier
decline, after domestic wholesale trade data supported bets that
the Bank of Canada would leave interest rates unchanged this
year.
    The Bank of Canada has kept its benchmark interest rate on
hold at 1.75% in 2019 even as some of its major peers, including
the U.S. Federal Reserve, have eased.
    Reduced expectations for another Fed rate cut as soon as
October and firm domestic data are giving the Bank of Canada
more time to remain on the sidelines, said Tony Valente, senior
FX dealer at AscendantFX.
    "This is why I don't see the Canadian dollar losing any
ground right now," Valente said.
    Canadian wholesale trade increased by 1.7% in July from June
on stronger sales in the personal and household goods subsector,
as well as motor vehicles and parts, Statistics Canada said.
Analysts had forecast a 0.1% decrease.    
    Canada's economy could also get a boost if politicians were
to carry out spending or tax-cut measures promised in the
federal election campaign.             .
    At 3:50 p.m. (1950 GMT), the Canadian dollar          was
trading 0.1% higher at 1.3254 to the greenback, or 75.45 U.S.
cents. The currency, which rose 0.2% last week, traded in a
range of 1.3252 to 1.3305.
    The 200-day moving average, which is at 1.3306, has been
providing support for the loonie, Valente said.
    The U.S. dollar        rose against a basket of major
currencies after weaker-than-expected German flash purchasing
managers' index survey data pressured the euro.             
    For the price of oil, one of Canada's major exports, signs
of European economic weakness were offset by lingering concerns
over global supplies following the Sept. 14 attack on Saudi oil
facilities. U.S. crude oil futures        settled nearly 1%
higher at $58.64 a barrel.             
    Canadian government bond prices were higher across the yield
curve in sympathy with U.S. Treasuries. The two-year           
rose 3 Canadian cents to yield 1.557% and the 10-year
            was up 17 Canadian cents to yield 1.368%.
    The 10-year yield touched its lowest intraday level since
Sept. 10 at 1.339%.

 (Reporting by Fergal Smith; Editing by Chizu Nomiyama and Peter
Cooney)
  
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