April 30, 2018 / 8:40 PM / 6 months ago

CANADA FX DEBT-C$ dips against stronger greenback, rises 0.5 pct in April

 (Adds strategist quotes and details throughout on market
activity, updates prices)
    * Canadian dollar at C$1.2839, or 77.89 U.S. cents
    * Loonie rises in April for eighth time in last 10 years
    * Price of oil rises 0.7 percent
    * Bond prices higher across the yield curve

    By Fergal Smith
    TORONTO, April 30 (Reuters) - The Canadian dollar edged
lower against its broadly stronger U.S. counterpart on Monday,
but outperformed some other major currencies as oil prices rose
and inflation data pointed to further Bank of Canada interest
rate hikes this year.
    At 4 p.m. (2000 GMT), the Canadian dollar          was
trading 0.1 percent lower at C$1.2839 to the greenback, or 77.89
U.S. cents.
    For the month, the loonie rose 0.5 percent. It is the eighth
time in the past 10 years that the loonie has climbed in April,
a sequence strategists link to seasonal strength in stocks and
energy products.             
    Canadian producer prices increased by 0.8 percent in March
from February, the third straight monthly rise, on higher prices
of energy and petroleum products as well as paper and pulp,
Statistics Canada said.             
    "Canadian inflation is continuing to rise," said Colin
Cieszynski, chief market strategist at SIA Wealth Management.
"That does keep the pressure on the Bank of Canada to raise
rates at some point."
    The central bank has raised interest rates three times since
July to leave its benchmark rate at 1.25 percent. Money markets
expect another hike by September.           
    Investors also weighed the prospect of Canada getting a
further exemption from U.S. tariffs on steel and aluminum
imports. U.S. President Donald Trump imposed the tariffs in
March but granted a temporary exemption to Canada that runs out
on Tuesday.
    Prime Minister Justin Trudeau said any move by the United
States to impose tariffs on Canadian steel and aluminum would be
a "very bad idea" guaranteed to disrupt trade between the two
nations.                     
    The price of oil, one of Canada's major exports, rose as
Israeli Prime Minister Benjamin Netanyahu said Israel had proof
that "Iran lied" about its nuclear weapons capability. U.S.
crude oil futures        settled 0.7 percent higher at C$68.57 a
barrel.             
    Weaker-than-expected German data hurt the euro against the
U.S. dollar, while the euro hit its weakest intraday level in
more than two weeks against the loonie at C$1.5462.             
    Canada's stock exchange, the world's sixth largest, was back
in business after a hardware glitch abruptly ended trading on
Friday.             
    Canadian government bond prices were higher across the yield
curve, with the two-year            up 1.5 Canadian cents to
yield 1.891 percent and the 10-year             rising 14
Canadian cents to yield 2.308 percent.
    Canadian gross domestic product data for February is due on
Tuesday and March trade data is due on Thursday.    

 (Reporting by Fergal Smith; Editing by Susan Thomas and Peter
Cooney)
  
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