Canadian dollar little changed as investor caution offsets oil rally

Thu Apr 6, 2017 10:51am EDT
 
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TORONTO (Reuters) - The Canadian dollar was little changed against its U.S. counterpart on Thursday even as oil prices rose, with investors wary before a meeting between U.S. President Donald Trump and his Chinese counterpart Xi Jinping.

Trump faces pressure to deliver trade concessions for some of his most fervent supporters and prevent a crisis with North Korea from spiraling out of control.

Signs that the U.S. Federal Reserve might start paring asset holdings also weighed on risk appetite as did evaporating hopes of an early U.S. fiscal stimulus program.

Commodity-linked currencies, such as the loonie, tend to underperform when investors turn less optimistic about the economic outlook.

Prices of oil, one of Canada's major exports, were on track for a fourth consecutive daily gain after recovering from losses triggered by record high U.S. crude inventories.

U.S. crude CLc1 prices were up 0.92 percent to $51.62 a barrel.

At 9:42 a.m. ET (1342 GMT), the Canadian dollar CAD=D4 was trading at C$1.3425 to the greenback, or 74.49 U.S. cents, slightly stronger than Wednesday's close of C$1.3427, or 74.48 U.S. cents.

The currency traded in a range of C$1.3418 to C$1.3451.

The loonie on Tuesday hit a nearly three-week low at C$1.3455, pressured by domestic data showing an unexpected trade deficit.   Continued...

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