TORONTO: The Canadian dollar weakened to a new one-week low against its US counterpart on Wednesday as oil fell, but losses were restrained ahead of a US interest rate decision and after stronger-than-expected domestic manufacturing data.
Canadian factory sales rebounded in April, rising by a higher-than-expected 1.0 percent from March, after declining for two consecutive months, data from Statistics Canada showed.
Oil prices were on course to fall for the fifth straight session in what would be their longest losing streak since February, knocked by mounting concerns about Britain's possible exit from the European Union and a surprise rise in US inventories. US crude prices were down 1.55 percent at $47.74 a barrel.
At 9:12 a.m. EDT (1312 GMT), the Canadian dollar was trading at C$1.2885 to the greenback, or 77.61 US cents, weaker than Tuesday's close of C$1.2853, or 77.80 US cents.
The currency's strongest level of the session was C$1.2827, while it touched its weakest since June 6 at C$1.2890.
The Federal Reserve is expected to keep interest rates unchanged on Wednesday and signal if it still plans to raise rates twice in 2016 amid concerns about a US hiring slowdown and Britain's possible exit from the European Union.
Sales of existing Canadian homes fell 2.8 percent in May from a record high in April as inventories fell to all-time lows in key regions while prices continued to climb, a report from the Canadian Real Estate Association showed.
Borrowing activity by Canadian small businesses fell for the fifth consecutive month in April, data from PayNet showed, pointing to an economy that is struggling to regain momentum after the steep drop in oil prices over the past two years.
Canadian government bond prices were lower across the maturity curve, with the two-year price down 1 Canadian cent to yield 0.503 percent and the benchmark 10-year falling 8 Canadian cents to yield 1.127 percent.
On Tuesday, the 10-year yield hit its lowest in nearly four months at 1.078 percent.
Bank of Canada Governor Stephen Poloz will give a speech titled "The Canadian Economy: A Progress Report" and will subsequently hold a press conference. His remarks will be published on the central bank's website at 7:40 p.m. EDT (2340 GMT).
The Bank of Canada said last month that the impact of the wildfires in Alberta could take 1.25 percentage points off growth in the second quarter.
Comments
Comments are closed for this article.