Canadian dollar heads for weekly decline as GDP dips

TORONTO: The Canadian dollar hardly moved against its US counterpart on Friday as oil prices fell and domestic data showed the economy shrinking in July, leaving the currency on track to edge lower for the week as the greenback broadly climbed.

Canada's economy contracted 0.1% in July, weighed by a decline in the goods-producing sector, data from Statistics Canada showed. A preliminary estimate showed GDP increasing 0.7% in August.

The price of oil, one of Canada's major exports, fell on the prospect that OPEC+ producers might step up a planned increase in output to ease supply concerns.

US crude prices fell 0.8% to $74.44 a barrel, while the Canadian dollar was nearly unchanged at 1.2675 per greenback, or 78.90 US cents. The currency traded in a range of 1.2652 to 1.2738.

For the week, the loonie was down 0.2%. It weakened 0.5% in September, its fourth straight monthly decline.

Canadian dollar loses ground to high-flying greenback

The US dollar headed for its best week since June as investors expected a hawkish-sounding Federal Reserve to lift US interest rates sooner than some major peers.

Canadian government bond yields were lower across a flatter curve as trading resumed following Thursday's public holiday.

The 10-year eased 5 basis points to 1.458%, tracking the move lower in US Treasury yields. On Tuesday, it touched its highest in nearly four months at 1.526%.