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Canadian dollar hits 2-week low as global trade uncertainty lingers

Published 2019-01-24, 10:03 a/m
© Reuters.  Canadian dollar hits 2-week low as global trade uncertainty lingers
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 dips 0.1 percent against the greenback

* Loonie touches its weakest since Jan. 7 at 1.3375

* Price of U.S. oil falls 0.1 percent

* Bond prices rise across the yield curve

TORONTO, Jan 24 (Reuters) - The Canadian dollar weakened to its lowest in more than two weeks against its U.S. counterpart on Thursday as optimism faded for a near-term resolution to a trade dispute between the United States and China.

The United States and China are a long way from resolving trade issues, but there is a fair chance the two countries will get to a trade deal, U.S. Commerce Secretary Wilbur Ross said. exports many commodities, including oil, so its economy could be hurt if the trade dispute drags on.

U.S. crude CLc1 prices were down 0.1 percent at $52.59 a barrel as concern over the global economy reasserted itself, reversing earlier price gains made on the potential for U.S. sanctions on OPEC member Venezuela. 9:41 a.m. EST (1441 GMT), the Canadian dollar CAD=D4 was trading 0.1 percent lower at 1.3352 to the greenback, or 74.90 U.S. cents. The currency touched its weakest since Jan. 7 at 1.3375.

The two-week low for the loonie comes after a string of weak domestic data this week prompted some economists to project a November contraction in Canada's economy.

Chances of another Bank of Canada interest rate hike by the summer have fallen to less than 30 percent from more than 50 percent at the end of last week. The central bank has hiked five times since July 2017. BOCWATCH

Canadian government bond prices were higher across the yield curve in sympathy with U.S. Treasuries. The two-year CA2YT=RR rose 5 Canadian cents to yield 1.87 percent and the 10-year CA10YT=RR climbed 26 Canadian cents to yield 1.940 percent.

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