October 31, 2016 / 1:52 PM / 10 months ago

CANADA FX DEBT-C$ weakens against firmer greenback as oil falls

* Canadian dollar at C$1.3400, or 74.63 U.S. cents
    * Bond prices higher across the yield curve

    TORONTO, Oct 31 (Reuters) - The Canadian dollar weakened
against its U.S. counterpart on Monday as oil prices fell and
the greenback made broader gains, but losses were restrained
ahead of domestic gross domestic product data on Tuesday.
    U.S. crude was down 1.36 percent at $48.04 a barrel
after producers that are not in the Organization of the
Petroleum Exporting Countries made no specific commitment to
join the group in limiting output levels to prop up prices.
 
    The U.S. dollar rebounded against a basket of major
currencies after being pressured on Friday by news that the FBI
was investigating emails linked to U.S presidential candidate
Hillary Clinton's private computer server. 
    Gains for the greenback came as data showed a
stronger-than-expected rise for consumer spending in September,
which could bolster expectations of an interest rate hike from
the Federal Reserve in December. 
    At 9:25 a.m. EDT (1325 GMT), the Canadian dollar 
was trading at C$1.3400 to the greenback, or 74.63 U.S. cents,
weaker than Friday's close of C$1.3384, or 74.72 U.S. cents.
    The currency's strongest level of the session was C$1.3376,
while its weakest was C$1.3431.
    On Friday, the loonie touched its weakest since March 9 at
C$1.3434.
    The European Union and Canada signed a free trade agreement
on Sunday that aims to generate jobs and economic growth, but it
must still clear some 40 national and regional parliaments in
Europe in the coming years to take full effect.    
    
    Speculators trimmed bearish bets on the Canadian dollar,
Commodity Futures Trading Commission data showed on Friday. Net
short Canadian dollar positions dipped to 13,324 contracts in
the week ended Oct. 25 from 14,298 in the prior week.
 
    Canadian government bond prices were higher across the yield
curve, with the two-year up 2.5 Canadian cents to
yield 0.555 percent and the benchmark 10-year rising
15 Canadian cents to yield 1.212 percent.
    On Tuesday, data is expected to show that Canada's economy
grew 0.2 percent in August. 
    Also on Tuesday, the Canadian government will update its
fiscal and economic position, providing new estimates for its
budget deficit and for economic growth.

 (Reporting by Fergal Smith; Editing by Lisa Von Ahn)

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