February 6, 2017 / 2:54 PM / in 8 months

Canadian dollar weaker as oil slips; trade data eyed

A Canadian dollar coin, commonly known as the "Loonie", is pictured in this illustration picture taken in Toronto January 23, 2015. REUTERS/Mark Blinch

TORONTO (Reuters) - The Canadian dollar weakened against its U.S. counterpart on Monday as oil prices slipped and bond yields set a one-week low, with investors awaiting December trade data due on Tuesday for signs of momentum in a nascent export revival.

The loonie, as Canada’s currency is colloquially known, has gained for two straight weeks on a combination of favorable economic data and greenback weakness. Last week it touched its strongest level since September.

At 8:47 a.m. ET (1347 GMT), the Canadian dollar CAD=D4 was trading at C$1.3073 to the greenback, or 76.49 U.S. cents, weaker than the Bank of Canada’s official close on Friday of C$1.3028, or 76.76 U.S. cents.

The loonie was trading in a range of C$1.3008 to C$1.3085.

Economists polled by Reuters have a wide range of expectations for Tuesday’s data after Canada achieved its first trade surplus in more than two years in November.

The most optimistic see a C$1.5 billion surplus, while the most pessimistic expect a C$1.5 billion deficit. The median view is for a surplus of C$350 million after the surprise C$526 million surplus in the prior month.

Jobs data is due on Friday.

U.S. crude oil CLc1 prices were down 0.35 percent at $53.64 a barrel, while Brent LCOc1 lost 0.56 percent to $56.49.[O/R]

Canadian government bond prices were higher across the maturity curve, with the two-year CA2YT=RR price up 4 Canadian cents to yield 0.755 percent and the benchmark 10-year CA10YT=RR rising 43 Canadian cents to yield 1.71 percent.

The Canada-U.S. two-year bond spread narrowed to -41.8 basis points, while the 10-year spread came in to -71.5 basis points.

Reporting by Alastair Sharp; Editing by Lisa Von Ahn

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