C$ pares weekly gain as oil falls, home sales tumble

* Canadian dollar dips 0.2 percent against the greenback
* Canadian homes sales tumble 9.1 percent in February
* Price of U.S. oil falls 1.1 percent
* Canada's 10-year yield touches its lowest since June 2017

TORONTO, March 15 (Reuters) - The Canadian dollar weakened
against its U.S. counterpart on Friday, reducing its gains for
the week as oil prices fell and domestic data showed a steep
drop in home sales.
Canadian homes sales tumbled 9.1 percent in February from
the previous month to hit their lowest level since November
2012, the Canadian Real Estate Association said.
The home sales decline offset separate data showing a
stronger-than-expected rise in Canadian manufacturing sales.
Factory sales were up by 1.0 percent in January from
December, Statistics Canada said. Analysts surveyed by Reuters
had forecast on average an increase of 0.4 percent.

The price of oil, one of Canada's major exports, retreated
as worries about the global economy and robust U.S. production
put a brake on prices. U.S. crude oil futures were down
1.1 percent at $57.95 a barrel.
At 9:35 a.m. (1335 GMT), the Canadian dollar was
trading 0.2 percent lower at 1.3362 to the greenback, or 74.84
U.S. cents. The currency traded in a range of 1.3290 to 1.3372.
For the week, the loonie was on track to rise 0.4 percent.
The decline for the loonie on Friday came one day after Bank
of Canada senior deputy governor Carolyn Wilkins said that
rising global debt is slowing economic growth and making Canada,
and the rest of the world, more vulnerable to another period of
financial instability.
Still, the Bank of Canada is unlikely to cut interest rates
to support a flagging economy as long as job growth continues at
a robust pace, an analysis of the central bank's response to
past divergences in economic data suggests.
Canadian government bond prices were higher across the yield
curve in sympathy with U.S. Treasuries after data showing U.S.
manufacturing output fell for a second straight month in
February.
The two-year rose 6.5 Canadian cents to yield
1.621 percent and the 10-year was up 38 Canadian
cents to yield 1.712 percent. The 10-year yield touched its
lowest intraday since June 2017 at 1.709 percent.

(Reporting by Fergal Smith; Editing by David Gregorio)


2019-03-15 15:50:46

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