June 20, 2016 / 1:52 PM / a year ago

Canadian dollar strengthens to one-week high as oil rallies, Brexit fears ease

TORONTO (Reuters) - The Canadian dollar strengthened to a one-week high against its broadly weaker U.S. counterpart on Monday, tracking oil and stocks higher as worries eased that Britons will vote to leave the European Union and offset disappointing domestic data.

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

Global stocks rose and oil rallied after polls showed support for Britain staying in the EU regaining momentum before Thursday’s referendum.

U.S. crude CLc1 prices were up 2.06 percent to $48.97 a barrel, supportive of Canada’s risk-sensitive commodity-linked currency.

At 9:26 a.m. EDT, the Canadian dollar CAD=D4 was trading at C$1.2779 to the greenback, or 78.25 U.S. cents, stronger than Friday’s close of C$1.2878, or 77.65 U.S. cents.

The currency’s weakest level of the session was C$1.2878, while it touched its strongest since June 13 at $1.2778.

The value of Canadian wholesale trade rose 0.1 percent in April, far less than expected, data from Statistics Canada showed. Volumes rose by 0.2 percent. It was the latest sign that the second quarter began on weak footing.

Speculators cut bullish bets on the loonie for the second straight week, Commodity Futures Trading Commission data showed on Friday. Net long Canadian dollar positions fell to 18,440 contracts in the week ended June 14 from 21,537 contracts in the prior week.

Canadian government bond prices were lower across a steeper maturity curve in sympathy with Treasuries as investor appetite waned for safe-haven assets.

The two-year CA2YT=RR price fell 5.5 Canadian cents to yield 0.548 percent and the benchmark 10-year CA10YT=RR dropped 65 Canadian cents to yield 1.188 percent.

Last week, the 10-year yield hit a four-month low at 1.052 percent.

Canadian retail sales data is awaited on Wednesday. Retail sales are expected to have climbed by 0.9 percent in April after falling in March. ECONCA

Reporting by Fergal Smith; Editing by Nick Zieminski

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