Canadian dollar, 'stuck in a range,' clings to weekly gain

TORONTO: The Canadian dollar was little changed against its US counterpart on Friday, holding on to this week's rally as it kept to a narrow trading range with US markets closed in observance of Independence Day.

The loonie was trading nearly unchanged at 1.3567 to the greenback, or 73.71 US cents. It traded in a range of 1.3553 to 1.3577. For the week, it was on track to rise 0.9%.

"The CAD appears to be stuck in a range ... in the absence of any major domestic developments," strategists at Scotiabank, including Shaun Osborne, said in a note.

It is "supported near 1.37 but better offered near 1.35," the strategists said.

The loonie has been supported this week by evidence that the economy is recovering from the coronavirus crisis, including data on Thursday showing that exports climbed 6.7% in May.

But investors are wary of a surge of new coronavirus infections that has prompted US states to delay and in some cases reverse plans to let stores reopen and activities resume.

Canada sends about 75% of its exports to the United States, including oil.

US crude prices were down 1.2% at $40.18 a barrel as a resurgence of coronavirus cases raised concern that fuel demand growth could stall.

Canadian government bond yields were lower across much of a flatter curve, with the 10-year down 1.6 basis points at 0.545%.

Canada's employment report for June is due next week, while the Bank of Canada will release its Business Outlook Survey and Finance Minister Bill Morneau will present an economic and fiscal snapshot.