CANADA FX DEBT-C$ strengthens to 10-day high, helped by global stimulus prospects

Mon Jul 4, 2016 10:14am EDT
 
Email This Article |
Share This Article
  • Facebook
  • LinkedIn
  • Twitter
| Print This Article
[-] Text [+]

* Canadian dollar at C$1.2857, or 77.78 U.S. cents
    * Loonie touched its strongest since June 24 at C$1.2851
    * Bond prices higher across the maturity curve

    TORONTO, July 4 (Reuters) - The Canadian dollar strengthened
to a 10-day high against its U.S. counterpart on Monday as
expectation that global central banks are likely to provide more
stimulus to offset the impact of Brexit supported
commodity-linked currencies.
    Gains for the loonie came amid light trading volumes for
European markets because of the July 4 public holiday in the
United States. Canada's stock and bond markets were
closed on Friday for Canada Day.
    The Australian dollar recovered from a wobbly start caused
by political uncertainty as expectations that the U.S. Federal
Reserve is in no hurry to raise rates provided support.
 Australia, like Canada, is a commodity producer.
    Oil prices were little changed after Saudi Energy Minister
Khaled Al-Faleh said that the market was heading towards
balance, offsetting signs of slowing demand in Asia. U.S. crude
 prices were unchanged at $48.99 a barrel.
    At 9:55 a.m. EDT (1355 GMT), the Canadian dollar 
was trading at C$1.2857 to the greenback, or 77.78 U.S. cents,
stronger than Friday's close of C$1.2917, or 77.42 U.S. cents.
    The currency's weakest level of the session was C$1.2923,
while it touched its strongest since June 24 at C$1.2851.       
         
    Speculators increased bullish bets on the loonie for the
first time in four weeks, Commodity Futures Trading Commission
data showed on Friday. Net long Canadian dollar positions rose
to 7,949 contracts in the week ended June 28 from 2,595
contracts in prior week.
    Canadian government bond prices were higher across the
maturity curve as the post-Brexit recovery across European stock
 markets stalled.
    The two-year price rose 0.5 Canadian cent to
yield 0.515 percent and the benchmark 10-year firmed
9 Canadian cents to yield 1.05 percent.
    The 10-year yield touched its lowest since Feb. 12 at 1.042
percent. 
    The Bank of Canada will release its business outlook survey
at 10:30 a.m. EDT (1430 GMT), a summary of interviews conducted
by the central bank's regional offices with the senior
management of about 100 firms.
    Data last week showed that Canada's economy grew by just 0.1
percent in April from March, clearing the way for a sickly
second quarter on the back of the devastation caused by major
Alberta wildfires. 

 (Reporting by Fergal Smith; Editing by Bernard Orr)