C$ little changed in thin markets; busy data week in focus

Mon May 25, 2015 5:12pm EDT
 
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By Solarina Ho

TORONTO (Reuters) - The Canadian dollar finished little changed against the greenback on Monday in very thin holiday trading and ahead of a busy week in North American economic news.

Investors are focused on the Bank of Canada's interest rate decision on Wednesday and first-quarter economic growth data on Friday, as well as a jam-packed U.S. data calendar that could have implications for the U.S. Federal Reserve.

"For the Bank of Canada ... There's definitely risk, but I'd say expectations are pretty firmly for a status quo statement," said Greg Moore, senior currency strategist at RBC Capital Markets.

Moore noted that Governor Stephen Poloz already telegraphed in a speech last week that the Bank's position has not changed much since the last meeting and monetary policy report in April.

"Even if it's a disappointment, which is what RBC expects, it won't be far off of the flat growth that the Bank of Canada was calling for. They've already said they're looking through whatever happens in Q1 to what happens to Q2," Moore said.

The loonie's pause comes after a retreat to a five-week low on Friday and with U.S. and many European markets closed for various holidays.

The Canadian dollar CAD=D4, which was weaker than all of its key currency counterparts, was trading at C$1.2313 to the greenback, or 81.21 U.S. cents, negligibly weaker than the Bank of Canada's official close of C$1.2301, or 81.29 U.S. cents on Friday.

The currency traded within a tight range, between C$1.2276 and C$1.2319.   Continued...

 
The new Canadian five and 10 dollar bills, made of polymer, are displayed with the previously released 20, 50 and 100 dollar notes following an unveiling ceremony at the Bank of Canada in Ottawa in this file photo taken on April 30, 2013. REUTERS/Chris Wattie