April 3, 2020 / 1:36 PM / 2 months ago

CANADA FX DEBT-Canadian dollar steadies as oil surges for 2nd straight day

    * Canadian dollar trades near flat against the greenback
    * For the week, the loonie is on track to fall 1%
    * Price of U.S. oil increases 8.5%
    * Canadian bond yields dip across the curve

    TORONTO, April 3 (Reuters) - The Canadian dollar was little
changed against its U.S. counterpart on Friday as oil prices
rallied for a second straight day, while data showing a plunge
in U.S. jobs added to evidence of the economic damage from the
coronavirus pandemic.
    At 9:09 a.m. (1309 GMT), the Canadian dollar          was
trading nearly unchanged at 1.4138 to the greenback, or 70.73
U.S. cents. The currency, which was on track to decline 1% for
the week, traded in a range of 1.4118 to 1.4223.
    U.S. nonfarm payrolls plummeted by 701,000 in March, a much
bigger-than-expected decline than had been expected. Canada
sends about 75% of its exports to the United States, including
oil.             
    U.S. crude oil futures        were up 8.5% at $27.48 a
barrel on rising hopes of a new global deal to cut global crude
supply.                 
    The Canadian dollar is set to remain at depressed levels
over the coming months, with analysts in a Reuters poll slashing
their forecasts for the currency as the coronavirus pandemic
potentially pushes Canada's economy into a deep recession.
            
    Ottawa is rolling out more than C$200 billion in support for
Canada's economy, including direct aid to Canadians, wage
subsidies for businesses, loan programs and tax deferrals, while
the Bank of Canada has slashed interest rates to nearly zero and
launched a large-scale asset purchase program, quantitative
easing, for the first time.                         
    Canada's biggest banks have received nearly half a million
requests from homeowners to hold off mortgage payments as the
economic fallout from the COVID-19 pandemic deepens, according
to the Canadian Bankers' Association.             
    Canadian government bond yields edged lower across the
curve. The 10-year             was down less than one basis
point at 0.693%. 

 (Reporting by Fergal Smith
Editing by Nick Zieminski)
  
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