CANADA FX DEBT-C$ slides as investors brace for Fed's Powell
Published Aug 23, 2018 15:44
CANADA FX DEBT-C$ slides as investors brace for Fed's Powell
* Canadian dollar at C$1.3085, or 76.42 U.S. cents
* Loonie falls 0.6 percent
* Bond prices lower across flatter yield curve
* Gap between 2- and 10-year yields hits narrowest in 11 years
By Fergal Smith
TORONTO, Aug 23 (Reuters) - The Canadian dollar weakened against its U.S. counterpart on Thursday, pulling back from a two-week high the day before, as the greenback rose broadly ahead of a speech on Friday by Federal Reserve Chairman Jerome Powell.
The U.S. dollar snapped a five-day losing streak, as a new round of U.S.-Chinese punitive trade tariffs boosted the greenback and the annual Federal Reserve conference began in Jackson Hole, Wyoming. is due to speak at the economic symposium on Friday. U.S. President Donald Trump told Reuters on Monday that he was "not thrilled" with rate increases under Powell, so the Fed chairman may wish to show he will not bow to pressure, said Shaun Osborne, chief currency strategist at Scotiabank.
"The (U.S.) dollar is generally strengthening up a bit more running into the Powell comments tomorrow," Osborne said. "There is an expectation that he can't sound in any way shape or form dovish."
At 3:14 p.m. (1914 GMT), the Canadian dollar CAD=D4 was trading 0.6 percent lower at C$1.3085 to the greenback, or 76.42 U.S. cents. The currency traded in a range of C$1.2994 to C$1.3099.
On Wednesday, the loonie touched its strongest level in two weeks at C$1.2987 as oil prices jumped and optimism grew about progress in negotiations on the North American Free Trade Agreement.
Canada's foreign minister said on Thursday that Canada would need to agree to any final conclusion on "rules of origin" reached in bilateral talks between the United States and Mexico as part of the modernization of NAFTA. price of oil, one of Canada's major exports, steadied as the escalating trade war between the United States and China weighed on demand expectations a day after prices jumped on a big draw in U.S. crude inventories. crude oil futures CLc1 settled three cents lower at $67.83 a barrel.
Canadian government bond prices were lower across a flatter yield curve, with the two-year CA2YT=RR down 2.5 Canadian cents to yield 2.125 percent and the benchmark 10-year CA10YT=RR falling 1 Canadian cent to yield 2.259 percent.
The gap between the two-year and 10-year yields shrank by 1.4 basis points to a spread of 13.4 basis points, its narrowest since October 2007.
Get The App
Written By: Reuters
Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.