September 27, 2019 / 8:36 PM / 17 days ago

CANADA FX DEBT-C$ posts 11-day high, supported by BoC steady rate outlook

 (Adds strategist quotes and details throughout; updates prices)
    * Canadian dollar rises 0.2% against the greenback
    * Loonie edges 0.1% higher for the week
    * Alberta allows producers to raise output
    * Price of U.S. oil declines 0.9%
    * Canadian bond prices were little changed

    By Fergal Smith
    TORONTO, Sept 27 (Reuters) - The Canadian dollar
strengthened to an 11-day high against its U.S. counterpart on
Friday as the Bank of Canada's willingness to keep interest
rates on hold in the face of economic uncertainty helped
"anchor" the currency.
    The Bank of Canada has showed no appetite for cutting
interest rates amid steady domestic activity, even as other
central banks, including the Federal Reserve, have eased this
year.             ]
    "In the absence of a major negative shock coming from trade,
or anything like that, we know that the Bank of Canada is not in
a rush to ease policy," said Mazen Issa, a senior FX strategist
at TD Securities. "I think that helps to provide an anchor."
    Uncertainty around global trade is keeping the loonie from
making further gains, Issa said.
    U.S. stocks fell after news the Trump administration was
considering delisting Chinese companies from U.S. stock
exchanges and limiting U.S. investments in China.               
 
    At 4:10 p.m. (2010 GMT), the Canadian dollar          was
trading 0.2% higher at 1.3243 to the greenback, or 75.51 U.S.
cents. The currency, which was up 0.1% for the week, touched its
strongest intraday level since Sept. 16 at 1.3214.
    The gain for the loonie on Friday came as the government of
Alberta announced plans to ease oil curtailments. Oil is one of
Canada's biggest exports so the steady erosion of curtailments
since the start of the year could improve prospects for the
economy.             
    Oil prices fell and posted a weekly loss on a
faster-than-expected recovery in Saudi output, while investors
also worried about global crude demand amid slowing Chinese
economic growth. U.S. crude oil futures        settled 0.9%
lower at $55.91 a barrel.                 
    Meanwhile, speculators have slashed their bullish bets on
the Canadian dollar to the lowest since June, data from the U.S.
Commodity Futures Trading Commission and Reuters calculations
showed. As of Sept. 24, net long positions had fallen to 4,592
contracts from 19,823 in the prior week.
    Canadian government bond prices were little changed across
the yield curve, with the two-year            flat to yield
1.575% and the 10-year             rising 2 Canadian cents to
yield 1.357%.
    On Wednesday, the 10-year yield touched its lowest intraday
level in more than two weeks at 1.289%.

 (Reporting by Fergal Smith; Editing by David Gregorio and Tom
Brown)
  
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