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Forex, News

C$ steadies as currency investors await ECB policy decision

* Canadian dollar rises 0.1% against the greenback * Price of U.S. oil up 0.5% * Canadian bond prices higher across the yield curve TORONTO, July 24 (Reuters) – The Canadian dollar edged higher on Wednesday against its U.S. counterpart, steadying after nearing a one-month low the previous day, as investors awaited interest rate decisions from major central banks over the coming week. Money markets are pricing in a 54% chance of a 10 basis point rate cut at Thursday’s European Central Bank meeting, while the Federal Reserve is expected to ease policy at the end of the month. The Bank of Canada has made clear that it has no intention of cutting interest rates. But recent strengthening of the Canadian dollar could ruin the central bank’s plan to sit out rate cuts by global peers. At 9:50 a.m. (1350 GMT), the Canadian dollar was trading 0.1% higher at 1.3123 to the greenback, or 76.20 U.S. cents. The currency, which notched on Monday its weakest intraday level in nearly one month at 1.3164, traded in a range of 1.3123 to 1.3147. The loonie has lost some ground since reaching a near nine-month high on Friday at 1.3016, pressured by weaker-than-expected retail sales and wholesale trade data for May. The price of oil, one of Canada’s major exports, rose on Wednesday after an industry group reported a much bigger than expected drop in U.S. inventories, while the U.S. Navy said it may have downed a second Iranian drone last week. U.S. crude oil futures were up by 0.5% at $57.03 a barrel. Canadian government bond prices were higher across the yield curve, with the two-year up 6 Canadian cents to yield 1.428% and the benchmark 10-year rising 41 Canadian cents to yield 1.454%. The 10-year yield touched its lowest intraday level since July 4 at 1.453, while the gap between the Canada’s 10-year yield and its U.S. counterpart widened by 2 basis points to 59.6 basis points, the biggest spread since June 19. (Reporting by Fergal Smith; Editing by Steve Orlofsky)


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