TORONTO (Reuters) - The Canadian dollar was sharply weaker against the greenback on Monday, dragged lower by commodity prices that were hit by disappointing data out of China.
Gold, silver, copper and oil prices were all slammed after data showed China’s recovery unexpectedly stumbled in the first three months of 2013, with an annual growth rate of 7.7 percent versus economists’ expectations of 8 percent growth.
“Obviously the key theme was the soft Chinese data and the impact it had on commodities and commodity currencies. Not surprisingly, Canada has weakened off a little bit,” said Matt Perrier, a director of foreign exchange sales at BMO Capital Markets.
“We’re seeing a small reprieve here as the North American session opens ... a minor rebound in commodities off their lows and you’ve seen coincidentally a rebound in the Canadian dollar back below C$1.02.”
At 9:03 a.m. (1403 GMT), the Canadian dollar was trading at C$1.0197 versus the U.S. dollar, or 98.07 U.S. cents, firmly lower than Friday’s finish at C$1.0138, or 98.64 U.S. cents. Earlier in the session, it had touched C$1.0226, or 97.79 U.S. cents, it’s weakest level in a week.
Perrier expects the currency to trade between C$1.0170 and C$1.0240 for the session as it tracks commodity moves.
The price of Canadian government debt was higher across the curve, with the two-year bond climbing 1.5 Canadian cents to yield 0.945 percent and the benchmark 10-year bond rising 4 Canadian cents to yield 1.733 percent.
Reporting by Solarina Ho; Editing by Kenneth Barry