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CANADA FX DEBT-C$ strengthens slightly, supported by higher oil prices

Published 2016-10-03, 09:58 a/m
© Reuters.  CANADA FX DEBT-C$ strengthens slightly, supported by higher oil prices
USD/CAD
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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$1.3110, or 76.28 U.S. cents

* Bond prices higher across the maturity curve

TORONTO, Oct 3 (Reuters) - The Canadian dollar strengthened slightly against its U.S. counterpart on Monday as U.S. crude oil prices climbed to their highest intraday level in nearly three months before some gains were pared.

U.S. crude CLc1 prices were up 0.08 percent at $48.28 a barrel, supported by a planned production cut by the Organization of Petroleum Exporting Countries, although analysts cautioned the persistent supply overhang could temper a longer-lasting rally. O/R

Modest gains for the loonie follow data on Friday that showed Canada's economy got off to a stronger-than-expected start in the third quarter. 9:43 a.m. EDT (1343 GMT), the Canadian dollar CAD=D4 was trading at C$1.3110 to the greenback, or 76.28 U.S. cents, slightly stronger than Friday's close of C$1.3117, or 76.24 U.S. cents.

The currency's strongest level of the session was C$1.3068, while its weakest was C$1.3137.

Speculators have turned bearish on the Canadian dollar, Commodity Futures Trading Commission data showed on Friday. Net short Canadian dollar positions stood at 11,615 contracts in the week ended Sept. 27, having swung from net long 16,303 contracts in the prior week. Canadian government is expected on Monday to roll out new measures aimed at slowing foreign investment in the country's major housing markets. government bond prices were higher across the yield curve, with the two-year CA2YT=RR up 0.5 Canadian cent to yield 0.519 percent and the benchmark 10-year CA10YT=RR rising 12 Canadian cents to yield 0.984 percent.

The 2-year yield fell 1.9 basis points further below its U.S. equivalent to leave the spread at -26 basis points, its largest gap since June 8.

Canada's international merchandise trade report for August is due on Wednesday. Investors will be looking to see if exports can maintain the previous month's strength. The September employment report is due on Friday. ECONCA

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