May 4, 2020 / 1:44 PM / 3 months ago

CANADA FX DEBT-Canadian dollar hits 11-day low as U.S.-China tensions rise

    * Canadian dollar weakens 0.1% against the greenback
    * Price of U.S. oil decreases 2.6%
    * Canadian bond yields dip across a steeper curve

    TORONTO, May 4 (Reuters) - The Canadian dollar weakened to
an 11-day low against the greenback on Monday as rising tensions
between the U.S. and China over the origin of the coronavirus
weighed on risk appetite and ahead of a speech by a Bank of
Canada official.    
    Shares globally          and the price of oil, one of
Canada's major exports, fell as the spat between top U.S.
officials and China fueled fears of a new trade war, derailing a
rebound in global markets.             
    U.S. crude oil futures        were down 2.6% at $19.27 a
barrel.    
    Bank of Canada Senior Deputy Governor Carolyn Wilkins will
speak on the central bank's response to the coronavirus pandemic
at 12:30 p.m. (1630 GMT). Wilkins was widely seen as the
front-runner to become the next governor of the central bank but
lost out to Tiff Macklem, a former senior deputy governor, when
the appointment was announced on Friday.             
    The Canadian dollar        was trading 0.1% lower at 1.4094
to the greenback, or 70.95 U.S. cents. The currency, which
gained 0.1% last week, touched its weakest intraday level since
April 23 at 1.4151.
    Speculators have increased their bearish bets on the
Canadian dollar, data from the U.S. Commodity Futures Trading
Commission showed on Friday. As of April 27, net short positions
had increased to 29,044 contracts from 23,891 in the prior week.
    Canadian government bond yields were lower across a steeper
yield curve on Monday, with the 2-year            down 2.7 basis
points at 0.298%.
    Canada's trade report for March is due on Tuesday, while the
April employment report is due on Friday.

 (Reporting by Fergal Smith
Editing by Nick Zieminski)
  
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