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CANADA FX DEBT-C$ lags most other G10 currencies as stocks retreat

Published 2018-12-17, 10:13 a/m
© Reuters.  CANADA FX DEBT-C$ lags most other G10 currencies as stocks retreat
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CA10YT=RR
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* Canadian dollar falls 0.1 percent against the greenback

* Loonie is one of two G10 currencies to decline

* Bond prices rise across a flatter yield curve

TORONTO, Dec 17 (Reuters) - The Canadian dollar weakened against its U.S. counterpart on Monday, underperforming most other G10 currencies as lingering worries about global growth weighed on stocks ahead of a potential interest rate hike this week from the Federal Reserve.

Wall Street lost ground as edgy investors waited for the Fed's monetary policy guidance on Wednesday and its implications of slowing global growth. exports many commodities, including oil, so its economy could be hurt by slower global growth. U.S. crude CLc1 prices were down 0.2 percent at $51.12 a barrel. 9:45 a.m. (1445 GMT), the Canadian dollar CAD=D4 was trading 0.1 percent lower at 1.3397 to the greenback, or 74.64 U.S. cents. The loonie, which traded in a range of 1.3373 to 1.3402, was the only G10 currency other than the Norwegian krone to decline.

Last week, the loonie fell 0.4 percent. It was the fourth straight week that the currency was down.

Domestic data showed that home sales slowed further last month. Resales of Canadian homes fell 2.3 percent in November from October, the Canadian Real Estate Association said. are also awaiting Canadian inflation data on Wednesday, which could help guide expectations for additional interest rate hikes from the Bank of Canada. Chances of a hike as soon as January have tumbled to less than 10 percent from about 60 percent before a dovish interest rate announcement from the central bank earlier this month. BOCWATCH

Still, speculators have cut their bearish bets on the Canadian dollar for the first time in five weeks, data from the U.S. Commodity Futures Trading Commission and Reuters calculations showed on Friday. As of Dec. 11, net short positions had dipped to 11,669 contracts from 12,936 a week earlier.

Canadian government bond prices were higher across a flatter yield curve, with the two-year CA2YT=RR up 1.5 Canadian cents to yield 2.013 percent and the 10-year CA10YT=RR rising 9 Canadian cents to yield 2.09 percent.

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