Breaking News

CANADA FX DEBT-C$ posts 3-1/2-week high, bearish bets hit record

ForexMay 19, 2017 17:00
Saved. See Saved Items.
This article has already been saved in your Saved Items
© Reuters. CANADA FX DEBT-C$ posts 3-1/2-week high, bearish bets hit record

* Canadian dollar C$1.3517, or 73.98 U.S. cents

* Short positions in Canadian dollar surged to 98,000 contracts

* Loonie hits strongest since April 25 at C$1.3511

* Bond prices mostly lower across the yield curve

By Solarina Ho

TORONTO, May 19 (Reuters) - The Canadian dollar strengthened on Friday to a 3-1/2-week high against its broadly weaker U.S. counterpart, supported in part by higher oil prices and by investors who had sold the Canadian dollar buying it back to reduce their exposure to the currency.

Speculators ramped up bearish bets on the Canadian dollar to a record high, data from the Commodity Futures Trading Commission and Reuters calculations showed. Canadian dollar net short positions surged to 98,000 contracts as of May 16 from 86,215 a week earlier.

The loonie had hit a 14-month low at C$1.3793 earlier in May, pressured in part by a more uncertain trade outlook with the United States as well as worries over the Canadian housing market.

"Both of those really led to an excessive amount of short positioning," said Bipan Rai, executive director and senior macro strategist at CIBC Capital Markets, noting that the futures market, a barometer of market sentiment toward the Canadian dollar, was at an all-time low.

"That's somewhat surprising given we're expecting 4 percent annualized growth for the GDP this quarter. So one of those things had to give," said Rai, adding that the market saw some of the short positions clear out on Friday.

At 4:00 p.m. ET (2000 GMT), the Canadian dollar CAD=D4 was trading at C$1.3517 to the greenback, or 73.98 U.S. cents, up 0.6 percent.

The currency's weakest level of the session was C$1.3611, while it touched its strongest since April 25 at C$1.3511.

Prices of oil, one of Canada's major exports, touched a one month high on expectations of a supply-cut extension. U.S. crude CLc1 prices were up 2.03 percent to $50.35 a barrel.

The U.S. dollar .DXY notched its biggest weekly drop in more than a year against a basket of major currencies, having given up gains made since Donald Trump, now surrounded by political worries, was elected U.S. president last year. domestic data, Canada's annual inflation rate held steady at 1.6 percent in April, short of economists' forecasts for 1.7 percent, as higher energy prices offset a decline in food costs for the seventh month in a row. Retail sales rose a stronger-than-expected 0.7 percent in March. government bond prices were mostly lower across the yield curve in sympathy with U.S. Treasuries. The two-year CA2YT=RR price was down half a Canadian cent to yield 0.675 percent, while the benchmark 10-year CA10YT=RR fell 24 Canadian cents to yield 1.471 percent.

CANADA FX DEBT-C$ posts 3-1/2-week high, bearish bets hit record

Related Articles

Add a Comment

Comment Guidelines

We encourage you to use comments to engage with users, share your perspective and ask questions of authors and each other. However, in order to maintain the high level of discourse we’ve all come to value and expect, please keep the following criteria in mind: 

  • Enrich the conversation
  • Stay focused and on track. Only post material that’s relevant to the topic being discussed.
  • Be respectful. Even negative opinions can be framed positively and diplomatically.
  •  Use standard writing style. Include punctuation and upper and lower cases.
  • NOTE: Spam and/or promotional messages and links within a comment will be removed
  • Avoid profanity, slander or personal attacks directed at an author or another user.
  • Don’t Monopolize the Conversation. We appreciate passion and conviction, but we also believe strongly in giving everyone a chance to air their thoughts. Therefore, in addition to civil interaction, we expect commenters to offer their opinions succinctly and thoughtfully, but not so repeatedly that others are annoyed or offended. If we receive complaints about individuals who take over a thread or forum, we reserve the right to ban them from the site, without recourse.
  • Only English comments will be allowed.

Perpetrators of spam or abuse will be deleted from the site and prohibited from future registration at Investing.com’s discretion.

Are you sure you want to delete this chart?
Write your thoughts here
Replace the attached chart with a new chart ?
Post also to:
Please wait a minute before you try to comment again.
Thanks for your comment. Please note that all comments are pending until approved by our moderators. It may therefore take some time before it appears on our website.
Are you sure you want to delete this chart?
Replace the attached chart with a new chart ?
Post 1000
Please wait a minute before you try to comment again.
Report this comment

I feel that this comment is:

Comment flagged

Thank You!

Your report has been sent to our moderators for review
Add Chart to Comment
Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.
Continue with Google
Sign up with Email