CANADA FX DEBT-C$ weakens as oil prices slide to 3-month low
* Canadian dollar at C$1.3487, or 74.15 U.S. cents * Bond prices slightly higher across the yield curve TORONTO, March 14 (Reuters) - The Canadian dollar weakened on Tuesday against its U.S. counterpart as prices of oil, one of Canada's major exports, fell and the greenback climbed broadly ahead of an expected interest rate rise by the U.S. Federal Reserve. With inflation showing signs of perking up, Fed policymakers may signal on Wednesday there could be more than the three rate rises they have forecast for this year. Gains for the U.S. dollar against a basket of currencies came as European currencies were weighed down by perceived political risks from Dutch and French elections and Britain's planned exit from the EU. U.S. crude prices fell to a three-month low, down 1.53 percent at $47.66 a barrel, pressured by rising oil stock worries. At 9:23 a.m. ET (1323 GMT), the Canadian dollar was trading at C$1.3487 to the greenback, or 74.15 U.S. cents, weaker than Monday's close of C$1.3444, or 74.38 U.S. cents. The currency's strongest level of the session was C$1.3440, while its weakest was C$1.3494. Last week the loonie hit a two-month low at C$1.3535 as oil dropped below $50 a barrel and as the yield advantage for the U.S. dollar grew. Canadian government bond prices were slightly higher across the yield curve, with the two-year up 3 Canadian cents to yield 0.86 percent and the 10-year rising 17 Canadian cents to yield 1.856 percent. The two-year yield fell 2.1 basis points further below its U.S. equivalent to a spread of -51.8 basis points. Earlier in March it had touched its widest gap since January 2016 at -55.2 bps. (Reporting by Fergal Smith Editing by W Simon)
© Thomson Reuters 2017 All rights reserved.