C$ strengthens as oil prices rise on output talks

Wed Feb 17, 2016 9:58am EST
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TORONTO (Reuters) - The Canadian dollar strengthened against its U.S. counterpart on Wednesday as crude oil prices rose on output talks, while domestic data pointed to a shift toward manufacturing as a driver of growth.

Oil prices rose as efforts led by Russia and Saudi Arabia to broker a deal to freeze production levels and ease a global glut turned to Iran. Its oil minister was to speak later Wednesday morning about the producers' meeting.

U.S. crude CLc1 prices were up 1.72 percent to $29.54 a barrel.

Stock market gains added to support for the risk-sensitive commodity currency. [.N] [.TO]

Commercial borrowing by small businesses in Canada picked up in December on strength in sectors such as manufacturing and agriculture, data from PayNet showed.

At 9:32 a.m. EST (1432 GMT), the Canadian dollar CAD=D4 traded at C$1.3810 to the greenback, or 72.41 U.S. cents, stronger than Tuesday's official close of C$1.3881, or 72.04 U.S. cents.

The currency's strongest level of the session was C$1.3784, while its weakest was C$1.3899. On Tuesday, it touched its strongest since Feb 4. at C$1.3707.

Canadian investors bought a record C$17.45 billion ($12.64 billion) worth of foreign securities in December, Statistics Canada said.

Canadian government bond prices were lower across the maturity curve, with the two-year CA2YT=RR price down 5.5 Canadian cents to yield 0.489 percent and the benchmark 10-year CA10YT=RR falling 42 Canadian cents to yield 1.201 percent.   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