CANADA FX DEBT-C$ slightly weaker as oil prices weigh

Published 2017-03-20, 05:01 p/m
© Reuters.  CANADA FX DEBT-C$ slightly weaker as oil prices weigh
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(Adds broker comment, updates prices to close)

* Canadian dollar settles at C$1.3354, or 74.88 U.S. cents

* Bond prices lower across the yield curve

* 2 and 10-year yields fall to lowest since March 7

By Alastair Sharp

TORONTO, March 20 (Reuters) - The Canadian dollar weakened slightly against its U.S. counterpart on Monday as lower oil prices offset strong trade data and investors weighed the G20's decision to avoid endorsing open trade.

Financial leaders of the world's biggest economies acquiesced to an increasingly protectionist United States on the weekend by dropping the pledge to keep global trade free and open. market is clearly not interested in that type of rhetoric, it's actually looking for something concrete to trade," said Brad Schruder, director of corporate sales and structuring at Bank of Montreal.

The Canadian dollar CAD=D4 settled at C$1.3354 to the greenback, or 74.88 U.S. cents, slightly weaker than Friday's close of C$1.3337, or 74.98 U.S. cents.

The currency traded in a range of C$1.3304 to C$1.3373.

Schruder said the Canadian currency will likely track crude oil prices more closely since the Federal Reserve's monetary policy outlook is priced in and details on the tax plans of U.S. President Donald Trump are likely several months away.

Prices of oil, one of Canada's major exports, fell on concerns that growing U.S. crude output could hamper an Organization of the Petroleum Exporting Countries-led production cut deal. crude CLc1 prices settled down 56 cents at $48.22 a barrel, while the Brent LCOc1 global benchmark was off 10 cents at $51.66.

Canadian wholesale trade unexpectedly soared by 3.3 percent in January on stronger sales of motor vehicles and parts, Statistics Canada data showed. In volume terms, wholesale trade grew by 3.4 percent, which is likely to bolster overall economic growth for the month. loonie rose 0.9 percent last week, helped by stronger-than-expected domestic manufacturing data and the prospect of Fed interest rate hikes proceeding at only a gradual pace.

Speculators cut bullish bets on the Canadian dollar for the second straight week, data from the Commodity Futures Trading Commission and Reuters calculations showed on Friday. government bond prices rose across the yield curve, with the two-year CA2YT=RR up 2.5 Canadian cents to yield 0.792 percent and the 10-year CA10YT=RR rising 28 Canadian cents to yield 1.727 percent.

The yields on both the 2-year and 10-year issues were their lowest since March 7.

Domestic retail sales data for January is due on Tuesday and the Canadian government will release its federal budget on Wednesday. ECONCA

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