TORONTO: The Canadian dollar strengthened against its US counterpart on Monday as oil prices rose and the government reported housing starts jumped to their highest level in more than nine years.
The seasonally adjusted annual rate of housing starts rose to 253,720 units in March, topping economists' forecasts for 215,000. February was revised slightly higher to 214,253 units.
US crude prices were up 1.15 percent at $52.84 a barrel, supported by a renewed shutdown at Libya's largest oilfield and heightened tension over Syria following the US missile strike. Oil is one of Canada's major exports.
At 9:22 a.m. ET (1322 GMT), the Canadian dollar was trading at C$1.3357 to the greenback, or 74.87 US cents, stronger than Friday's close of C$1.3410, or 74.57 US cents.
The currency traded in a range of C$1.3357 to C$1.3425.
On Friday, the loonie touched its strongest in four days at C$1.3343 after Canadian jobs data added to evidence that the domestic economy is improving.
Economists expect the Bank of Canada could raise its first-quarter growth forecast when it releases its interest rate announcement and latest economic outlook on Wednesday.
Still, the central bank is widely expected to hold rates at 0.50 percent and may stick to its cautious tone given the number of uncertainties facing the Canadian economy, particularly US trade policy.
Speculators have increased bearish bets on the Canadian dollar to the most since March 2016, data from the Commodity Futures Trading Commission and Reuters calculations showed on Friday. Canadian dollar net short positions increased to 30,225 contracts as of April 4 from 28,217 a week earlier.
Canadian government bond prices were mixed across the yield curve, with the two-year up 1 Canadian cent to yield 0.757 percent and the benchmark 10-year rising 12 Canadian cents to yield 1.583 percent.
On Friday, the 10-year yield touched a more than four-month low at 1.505 percent.
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