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Canadian dollar firms as global trade optimism rises

Published 2019-09-24, 10:07 a/m
© Reuters.  Canadian dollar firms as global trade optimism rises
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 rises 0.1% against the greenback

* Price of U.S. oil decreases 1.1%

* Canadian bond prices gain across a flatter yield curve

TORONTO, Sept 24 (Reuters) - The Canadian dollar edged higher against its U.S. counterpart on Tuesday as investors grew more optimistic on trade talks between the United States and China.

U.S. stocks rose as Washington confirmed that trade negotiations with China would resume in two weeks, easing some uncertainty caused by the cancellation of a planned U.S. farm visit by Chinese delegates last week. is a major exporter of commodities, including oil, so its economy could benefit from an improved outlook for global trade.

Oil prices fell as investors bet that Saudi Arabia could restore oil output faster than anticipated following attacks last week. U.S. crude oil futures CLc1 were down 1.1% at $58.01 a barrel. 9:55 a.m. (1355 GMT), the Canadian dollar CAD=D4 was trading 0.1% higher at 1.3253 to the greenback, or 75.45 U.S. cents. The currency's weakest level was 1.3266, while it touched its strongest since last Thursday at 1.3247.

The gain for the loonie came after stronger-than-expected wholesale trade data on Monday supported bets that the Bank of Canada would leave interest rates unchanged this year.

Chances of a rate cut by December have fallen to less than 30% from about 90% earlier this month, data from the overnight index swaps market showed. BOCWATCH

Canadian government bond prices were higher across a flatter yield curve, with the two-year CA2YT=RR price 1.5 Canadian cents to yield 1.558% and the 10-year CA10YT=RR rising 23 Canadian cents to yield 1.351%.

On Monday, the 10-year yield hit its lowest intraday level since Sept. 10 at 1.339%.

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