TORONTO (Reuters) - The Canadian dollar edged higher against its U.S. counterpart on Tuesday, recovering from an earlier one-month low, as oil prices rose and investors awaited a speech by U.S. President Donald Trump for clues on the outlook for trade conflicts.
World shares and benchmark government bond yields inched higher on hopes that Trump, who is due to speak at the Economic Club of New York later on Tuesday, would provide reassurances that trade talks with China were progressing and signal that a decision on European car tariffs would be delayed.
Canada is a major exporter of commodities, including oil, so its economy could benefit from a reduction in global trade uncertainty.
U.S. crude oil futures (CLc1) were up 0.8% at $57.33 a barrel, buoyed by trade hopes and lower inventories at a U.S. oil hub.
At 9:49 a.m. (1449 GMT), the Canadian dollar was trading 0.1% higher at 1.3223 to the greenback, or 75.63 U.S. cents. The currency's strongest level of the session was 1.3217, while it touched its weakest since Oct. 11 at 1.3257.
The one-month intraday low for the loonie came after data on Friday showed a surprise Canadian jobs decline in October.
The currency has declined as much as 1.3% since the Bank of Canada shifted nearly two weeks ago to a more dovish stance.
Still, investors have raised bullish bets on the loonie to the highest level since October 2017, data from the U.S. Commodity Futures Trading Commission and Reuters calculations showed on Friday. As of Nov. 5, net long positions in the currency had climbed to 54,002 contracts from 43,589 in the prior week.
Canadian government bond prices were lower across a steeper yield curve as trading resumed after a holiday on Monday in observance of Remembrance Day. The two-year (CA2YT=RR) fell 2.5 Canadian cents to yield 1.598% and the 10-year (CA10YT=RR) was down 24 Canadian cents to yield 1.607%.
It was the first time since July 25 that the 10-year yield traded above the 2-year yield. Reversion of the yield curve to upward sloping could reduce fears of an economic slowdown.