TORONTO (Reuters) - The Canadian dollar edged higher against the greenback on Monday, finding some support after two days of declines as oil prices rose and investors weighed executive orders from President Donald Trump to support the U.S. economy.
Trump's orders that partly restored enhanced unemployment benefits came after talks between the White House and top Democrats in Congress about fresh stimulus broke down. Canada sends about 75% of its exports to the United States, including oil.
U.S. crude (CLc1) prices were up 1.4% at $41.78 a barrel, supported by an improvement in Chinese factory data and rising energy demand as countries eased lockdowns, but traders remained cautious due to U.S.-China tensions and uncertainty over the U.S. stimulus package.
The Canadian dollar
The loonie notched last Wednesday a five-month high at 1.3229 but was then pressured by a trade dispute between Canada and the United States and a rebound by the U.S. dollar (DXY) against a basket of major currencies.
Speculators have raised bearish bets on the loonie to the highest in seven weeks, data from the U.S. Commodity Futures Trading Commission showed on Friday. As of Aug. 4, net short positions had increased to 23,195 contracts from 12,496 in the prior week.
Canadian government bond yields were mixed across the curve on Monday, with the 10-year (CA10YT=RR) down 1 basis point at 0.469%.