TORONTO: Canada's dollar was little changed against its US counterpart on Wednesday, with soft US economic data weighing on sentiment, but investors were largely focused on Sunday's election in Greece.
Data released on Wednesday showed that retail sales in the United States, Canada's largest export market, fell for a second straight month in May, and wholesale prices dropped by the most in three years.
The Canadian dollar traded in a narrow range against the greenback after the data but was weaker against most other major currencies, including the yen, euro and Australian dollar.
"We're not getting much personality out of the Canadian dollar, and it's lagging the broader market," said Jack Spitz, managing director of foreign exchange at National Bank Financial.
"I would attribute some of it to the weaker economic data that came out of the States earlier today. Canada, being looked at as a North American proxy, has faded along with the US dollar today."
EYE ON GREEK ELECTION
At 1:23 p.m. (1723 GMT) the Canadian dollar was at C$1.0260, or 97.47 US cents, compared with Tuesday's close at C$1.0267 to the US dollar, or 97.40 US cents. Earlier it had weakened to C$1.0287, or 97.21 US cents.
David Bradley, a director of foreign exchange trading at Scotiabank, said trading was fairly quiet, and noted that volume has been down in general. He saw the Canadian dollar moving within in a tight range on Wednesday as investors eyed the Greek election.
"The market seems pretty complacent trading off equities these days," he said.
Toronto's main stock index reversed early losses with a modest rally as mining and financial gains offset energy losses spurred by the soft US data.
Global markets are expected to be choppy ahead of the Greek vote, and on fears that Spain's financing problems may spread to Italy.
Still, Spitz saw the potential for news out of Europe to support the Canadian dollar, particularly the possibility of some kind of resolution in Greece coming out of the election.
"Europe slowly seems to be moving itself towards a more positive underlying tone," he said.
"We would see dollar/Canada at C$1.03 or above C$1.03 as an opportunity to sell (US dollars)."
Canadian bonds prices were mostly lower. Canada's two-year bond fell 6 Canadian cent to yield 1.048 percent, while the benchmark 10-year bond fell 5 Canadian cents, yielding 1.808 percent.
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