June 5, 2019 / 2:21 PM / a month ago

CANADA FX DEBT-C$ posts a 2-week high as rate cut bets weigh on greenback

    * Canadian dollar rises 0.1% against the greenback
    * Price of U.S. oil decreases 1.5%
    * Canadian productivity grows by 0.3% in the first quarter
    * Canada's 10-year yield hits a two-year low at 1.410%

    TORONTO, June 5 (Reuters) - The Canadian dollar strengthened
to a two-week high against its U.S. counterpart on Wednesday as
rising speculation that the Federal Reserve would cut interest
rates pressured the greenback.    
    The U.S. dollar        fell against a basket of major
currencies after Federal Reserve Chairman Jerome Powell on
Tuesday dropped his standard reference to the bank being
"patient" in approaching a rate decision, saying instead it
would respond as "as appropriate" to trade pressure.            
    At 10:03 a.m. (1403 GMT), the Canadian dollar          was
trading 0.1% higher at 1.3380 to the greenback, or 74.74 U.S.
cents. The currency touched its strongest level since May 22 at
1.3363.
    Canadian labor productivity grew by 0.3% in the first
quarter, reflecting a decline in hours worked for the first time
in seven consecutive quarters, while business output remained
virtually unchanged, Statistics Canada said.             
    Economists worry that weak productivity growth in Canada
could hold back growth in its trade-dependent economy.
                
    The price of oil, one of Canada's major exports, resumed its
slide on Wednesday after an unexpected gain in U.S. inventories.
U.S. crude        prices were down 1.5% to $52.68 a barrel,
                
    China plans to boost inspections of imported Canadian meats
and meat products as bilateral trade relations deteriorate,
Canadian government officials said on Tuesday, a move meat
industry executives said could have "a disastrous effect" on
their business.                 
    Canadian government bond prices were higher across the yield
curve in sympathy with U.S. Treasuries. The two-year           
rose 11 Canadian cents to yield 1.333% and the 10-year
            was up 49 Canadian cents to yield 1.425%.
    The 10-year yield touched its lowest intraday since June
2017 at 1.410%.    

 (Reporting by Fergal Smith
Editing by Susan Thomas)
  
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