C$ extends holding pattern as stocks weather UK political risk

TORONTO: The Canadian dollar was little changed against its US counterpart on Wednesday, extending this week's sideways pattern as stocks took British political upheaval in stride and oil prices reduced some of the previous day's gains.

World equity markets held their nerve after the heavy parliamentary defeat of British Prime Minister Theresa May's Brexit deal as investors saw potential for legislative deadlock forcing London to delay its departure from the European Union.

The price of oil, one of Canada's major exports, was pressured by worries about the global economy and forecasts of swelling US production. US crude oil futures were down nearly 1 percent at $51.61 a barrel,

At 8:52 a.m. (1352 GMT), the Canadian dollar was trading nearly unchanged at 1.3260 to the greenback, or 75.41 US cents. The currency, which on Monday touched its weakest level in nearly one week at 1.3297, traded in a range of 1.3245 to 1.3293.

For the week, the loonie was also nearly unchanged after rallying 2.9 percent since the start of the year.

Canadian government bond prices were lower across the yield curve in sympathy with US Treasuries. The two-year fell 4 Canadian cents to yield 1.915 percent and the 10-year declined 13 Canadian cents to yield 1.986 percent.

The two-year yield touched its highest intraday since Dec. 17 at 1.975 percent.

Canada's inflation report for December is due on Friday, which can help guide expectations for future interest rate hikes from the Bank of Canada.