May 29, 2017 / 9:01 PM / 6 months ago

Canadian dollar slightly weaker ahead of GDP data this week

TORONTO (Reuters) - The Canadian dollar edged lower in holiday-thinned trading on Monday, helped by a slight rise in oil prices while investors took a cautious approach ahead of a string of U.S. and Canadian economic data due later this week.

FILE PHOTO: A Canadian dollar coin, commonly known as the "Loonie", is pictured in this illustration picture taken in Toronto January 23, 2015. REUTERS/Mark Blinch/File Photo

At 4 p.m. ET (2000 GMT), the Canadian dollar CAD=D4 was trading at C$1.3459 to the greenback, or 74.30 U.S. cents, down 0.1 percent.

The currency traded in a range of C$1.3399 to C$1.3470, with volume the lowest since mid-April due to public holidays in the United States, Britain and China.

“Everything is subdued,” said Alphonso Esparza, senior market analyst at OANDA Corp, adding that he expects the Canadian currency to be pressured by mixed to positive U.S. data through the week and a strong non-farms U.S. payrolls number on Friday.

“The rest of the week doesn’t look that great for the loonie,” he said.

Canada is to release data on the country’s gross domestic product on Wednesday, while the country’s trade data for April is due on Friday.

Economists forecast that the Canadian economy grew at a 3.9 percent annualized pace in the first quarter after a strong expansion in the second half of 2016. ECONCA

Prices for oil, a major Canadian export, rose slightly, barely paring last week’s steep losses with the market remaining cautious as increases in U.S. drilling activity have undercut an OPEC-led push to tighten supply. [O/R]

The loonie rose 0.5 percent last week, touching its strongest in five weeks on Wednesday after the Bank of Canada struck a more upbeat tone than investors had expected.

Speculators increased bearish bets on the Canadian dollar to a record high, data from the Commodity Futures Trading Commission and Reuters calculations showed on Friday.

Canadian government bond prices were higher across a flatter maturity curve, with the two-year CA2YT=RR price down 1 Canadian cent to yield 0.708 percent and the 10-year CA10YT=RR rising 28 Canadian cents to yield 1.412 percent.

Reporting by Fergal Smith; Editing by James Dalgleish and Dan Grebler

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