CANADA FX DEBT-C$ firms against weaker greenback as oil losses pared
(Adds analyst comment, details on U.S. dollar and manufacturing sector data; updates prices) * Canadian dollar ended at C$1.3067, or 76.53 U.S. cents * Bond prices higher across the maturity curve By Fergal Smith OTTAWA, June 1 (Reuters) - The Canadian dollar strengthened against a broadly weaker greenback on Wednesday, ending three consecutive sessions of declines as oil pared its losses and investors braced for key economic data later in the week. The U.S. dollar fell against a basket of major currencies after Japan delayed a sales tax increase for longer than expected, while U.S. economic data was mixed and doubts lingered about the likelihood of a June interest rate increase by the Federal Reserve. Position squaring ahead of the U.S. employment report on Friday also supported the Canadian dollar against the greenback, said Mazen Issa, senior forex strategist at TD Securities. Oil regained most of its losses after sources of the Organization of the Petroleum Exporting Countries said the group will likely consider a production curb at its forthcoming meeting. U.S. crude futures settled at $49.01, down 9 cents. The Canadian dollar ended at C$1.3067 to the greenback, or 76.53 U.S. cents, stronger than the Bank of Canada's official close on Tuesday of C$1.3110, or 76.28 U.S. cents. The currency's strongest level of the session was C$1.3043, while its weakest was C$1.3123. The pace of growth in the Canadian manufacturing sector was little changed in May as measures of new orders and employment both slowed, the latest sign the economy is struggling to gain momentum. Canadian trade data is awaited on Friday. Economists expect the trade deficit narrowed in April and will be looking for a pickup in exports, which is key to the Bank of Canada's outlook. Canadian government bond prices were higher across the maturity curve, with the two-year price up 4.5 Canadian cents to yield 0.590 percent and the benchmark 10-year rising 17 Canadian cents to yield 1.302 percent. Falling yields on Canada's 2-year bond pushed its yield 5.1 basis points further below the comparable U.S. Treasury for a spread of -31.3 basis points, its largest gap since March 17. (Reporting by Leah Schnurr; Editing by Alan Crosby)
© Thomson Reuters 2016 All rights reserved.