TORONTO (Reuters) - The Canadian dollar weakened to a one-month low against its U.S. counterpart on Wednesday, but the currency’s decline lost some momentum as investors turned attention to a speech by Bank of Canada Governor Stephen Poloz on Thursday.
At 3:40 p.m. (2040 GMT), the Canadian dollar CAD=D4 was trading 0.1% lower at 1.3251 to the greenback, or 75.47 U.S. cents. The currency's strongest level of the session was 1.3230, while it touched its weakest since Oct. 11 at 1.3268.
The loonie has declined by as much as 1.5% since Oct. 30, when the Bank of Canada shifted to a more dovish stance by cutting its economic growth forecasts and expressing concern about global trade uncertainty.
“That fundamental is fully priced in, so if what we get out of Poloz and his speech from San Francisco is no change in the tone from what we have already seen, then I don’t think it will have much play, said Greg Anderson, global head of foreign exchange strategy at BMO Capital Markets in New York.
“It might keep us on a 1.32 handle in dollar-CAD but I don’t think it is going to push us to new thresholds. That would be much more data-dependent than anything,” Anderson said.
Poloz is due to speak on the fourth industrial revolution at the Federal Reserve Bank of San Francisco on Thursday evening. Money markets see chances of an interest rate cut from Canada's central bank next month at less than 25%. BOCWATCH
U.S. stocks seesawed as fresh uncertainty over relations between the United States and China offset upbeat comments by Federal Reserve Chairman Jerome Powell about the U.S. economy.
Canada is a major exporter of commodities, including oil, so its economy could be hurt by a more uncertain outlook for global trade.
U.S. crude oil futures CLc1 settled 0.6% higher after the Organization of the Petroleum Exporting Countries said it saw no signs of global recession and rival U.S. shale oil production could grow by much less than expected in 2020.
Canadian government bond prices were higher across a flatter yield curve, outperforming U.S. Treasuries after data showed U.S. consumer prices rebounded more than expected in October.
Reporting by Fergal Smith; Editing by Nick Zieminski and Peter Cooney
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