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CANADA FX DEBT-Canadian dollar lags G10 peers as bets mount against the currency

Published 2020-08-24, 04:48 p/m
USD/CAD
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CL
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CA10YT=RR
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(Adds strategist quotes and details throughout, updates prices)

* Canadian dollar falls 0.4% against the greenback

* Loonie touches its strongest intraday since Jan. 24 at 1.3130

* Price of U.S. oil settles 0.7% higher

* Canadian bond yields rise across much of a steeper curve

By Fergal Smith

TORONTO, Aug 24 (Reuters) - The Canadian dollar weakened against its U.S. counterpart and all the other G10 currencies on Monday, as recent data showed that speculators have added to bearish bets on the loonie despite it climbing to a seven-month high.

The loonie CAD= was trading 0.4% lower at 1.3226 to the greenback, or 75.61 U.S. cents. Earlier in the day, the currency touched its strongest intraday level since Jan. 24 at 1.3130.

"The Canadian dollar is broadly underperforming, which rather tells you that the dislike for the Canadian dollar that we seem to be seeing pretty consistently from the FX market is still there," said Shaun Osborne, chief currency strategist at Scotiabank.

Speculators have raised bearish bets on the loonie to the highest since May, data from the U.S. Commodity Futures Trading Commission showed on Friday.

"At some point we will see either a capitulation, or short squeeze from the CAD bears, or the CAD is going to go quite significantly lower," Osborne said.

U.S. crude oil futures CLc1 settled 0.7% higher at $42.62 as storms headed for the Gulf of Mexico shut more than half of the region's offshore production, with the more dangerous of the two storms expected to strike later in the week. is a major exporter of oil, as well as other commodities including lumber. The country largely won a case before the World Trade Organization in a long-running dispute with the United States over U.S. duties imposed on its softwood lumber exports. Bank of Canada is asking Canadians for the first time to provide feedback on the inflation targeting framework it uses to set monetary policy, the central bank said. government bond yields were higher across much of a steeper curve on Monday, with the 10-year CA10YT=RR up 2.2 basis points at 0.560%.

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