October 24, 2019 / 2:00 PM / 2 months ago

CANADA FX DEBT-Canadian dollar steadies near 3-month high as rate decisions loom

    * Canadian dollar trades flat against greenback
    * Loonie posts strongest intraday level since July 22 at
1.3053
    * Price of U.S. oil increases 0.1%
    * Canadian government bond prices mixed

    TORONTO, Oct 24 (Reuters) - The Canadian dollar was
unchanged against its U.S. counterpart on Thursday, pulling back
from an earlier three-month high as investors turned their
attention to interest rate decisions next week by the Bank of
Canada and the U.S. Federal Reserve.
    At 9:37 a.m. (1337 GMT), the Canadian dollar          was
unchanged at 1.3070 to the greenback, or 76.51 U.S. cents. The
currency touched its strongest intraday level since July 22 at
1.3053. 
    Investors expect Canada's central bank will leave its
benchmark interest rate on hold at 1.75% on Oct. 30 and over the
coming months, as the domestic economy shows resilience and the
election of a minority federal government adds to prospects of
growth-boosting fiscal spending next year.             
    In contrast, the Fed is expected to cut interest rates next
week for the third time this year. That could lower the range
for the Fed's benchmark rate below the equivalent rate for the
Bank of Canada of 1.75%.        
    U.S. Trade Representative Robert Lighthizer met this week
with Democratic lawmakers to try to resolve their concerns about
the United States-Mexico-Canada (USMCA) trade agreement as
Republicans increased pressure to get the deal passed by the end
of 2019.             
    Canada sends about 75% of its exports to the United States,
including oil.
    U.S. crude oil futures        were up 0.1% at $56.02 a
barrel, supported by a surprise drop in U.S. crude inventories
and the prospect of further action by OPEC and its allies to
support the market.             
    Canadian government bond prices were mixed across the yield
curve, with the two-year            down 1 Canadian cent to
yield 1.629% and the 10-year             rising 2 Canadian cents
to yield 1.516%.    

 (Reporting by Fergal Smith
Editing by Paul Simao)
  
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