July 24, 2020 / 7:27 PM / 21 days ago

CANADA FX DEBT-C$ eases vs U.S. dollar; set to finish week up about 1%

    * Canadian dollar at C$1.3428 or 74.47 U.S. cents
    * Bond prices fall across the maturity curve

 (Updates prices, adds details on U.S. data)
    By Saqib Iqbal Ahmed
    July 24 (Reuters) - The Canadian dollar eased against its
U.S. counterpart on Friday, but was set to finish the week about
1% higher, as the U.S. currency remained broadly weaker, weighed
down by American economic uncertainty as coronavirus cases rise
and U.S.-China relations further deteriorate.
    The Canadian dollar        was at C$1.3425 to the greenback,
or 74.49 U.S. cents, weaker than Thursday's close of C$1.3407,
or 74.59 U.S. cents.
     The loonie remained close to a six-week high hit on
Thursday. 
    "To a large extent though, the CAD is still the tail of the
FX dog and, with no domestic data ahead until next Friday’s GDP
report, the CAD will remain a slave to USD flows, crude oil, 
and the broader market tone," said Shaun Osborne, chief FX
strategist at Scotiabank in Toronto.
    The U.S. dollar fell against the Japanese yen on Friday
after China's foreign ministry told the U.S. embassy early on
Friday to close its consulate in the city of Chengdu, after
Washington ordered the closure of the Chinese consulate in
Houston.             
    The greenback also slipped against the euro after a survey
showed euro zone business activity bounced back to growth in
July. Separately, data showed U.S. business activity increased
to a six-month high in July, but companies reported a drop in
new orders as a resurgence in new COVID-19 cases across the
country weighed on demand.                          
    The loonie, which has been helped in recent sessions by
rising oil prices, found little of that support on Friday as oil
prices were nearly flat on the day.             
    On Friday, Canadian government bond prices were little
changed on the day. The two-year            yield was at 0.282%
down from 0.285% late on Thursday, while the benchmark Canadian
10-year             yield was at 0.504% up from 0.503%.

 (Reporting by Saqib Iqbal Ahmed; editing by Jonathan Oatis)
  
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