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CANADA FX DEBT-C$ posts modest gains as wholesale data beats

Published 2015-08-20, 10:01 a/m
CANADA FX DEBT-C$ posts modest gains as wholesale data beats
LCO
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CL
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CA2YT=RR
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CA10YT=RR
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* Canadian dollar at C$1.3103 or 76.32 U.S. cents
* Bond prices higher across the maturity curve

TORONTO, Aug 20 (Reuters) - The Canadian dollar strengthened
marginally against its U.S. counterpart on Thursday, helped in
part by a rise in the value of Canadian wholesale trade in June
and softening expectations of a Federal Reserve rate hike in
September.
Wholesale trade rebounded 1.3 percent, more than the 1
percent economists had forecast, following a 0.9 percent decline
in May. The figures supported projections that June will be a
more robust month for growth in Canada following a lackluster
performance for much of the first half of this year.

Crude prices were steady but remain a big driver for the
Canadian dollar due to the country's heavy concentration of
producers. U.S. prices have plunged to 6-1/2-year lows this
week, just above $40 a barrel, on ongoing worries about a global
supply glut coupled with potentially waning demand from major
consumers like China.
Investors also trimmed bets of a September rate hike, to a
probability of around 40 percent from 50 percent previously,
after Fed minutes indicated that policymakers were in no rush to
raise interest rates.

* At 9:47 a.m. EDT (1347 GMT), the Canadian dollar CAD=D4
was trading at C$1.3103 to the greenback, or 76.32 U.S. cents,
slightly firmer than the Bank of Canada's official close of
C$1.3110, or 76.28 U.S. cents, on Wednesday.
* The currency's strongest level of the session was
C$1.3076, while its weakest level was C$1.3176.
* Other noteworthy data included U.S. jobless claims, which
showed the number of Americans filing new applications for
unemployment benefits unexpectedly rose last week, even as the
trend showed the overall labor market still improving.

* Market participants are keenly awaiting Canadian CPI
inflation data for July and retail sales data for June, which
are due at 08:30 a.m. EDT on Friday.
* U.S. crude CLc1 prices were up 0.17 percent to $40.87,
while Brent crude LCOc1 lost 0.70 percent to $46.83. O/R
* The Canadian dollar is forecast to trade between C$1.3080
and C$1.3160 against the U.S. dollar during the North American
session on Thursday, according to National Bank Financial.
* Canadian government bond prices were higher across the
maturity curve, with the two-year CA2YT=RR price flat to yield
0.363 percent and the benchmark 10-year CA10YT=RR rising 15
Canadian cents to yield 1.304 percent.
* The Canada-U.S. two-year bond spread widened to -30.0
basis points, while the 10-year spread narrowed to -79.6 basis
points.

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