Canadian dollar holds near two-week low as oil slides

TORONTO: The Canadian dollar was little changed against its US counterpart on Thursday, holding near its lowest level in nearly two weeks as tighter coronavirus restrictions in Europe weighed on investor sentiment.

Global equities languished close to two-week lows while the dollar traded near a four-month high against the euro, as investors worried that Europe's COVID-19 response was falling behind that in the United States.

Europe's new round of coronavirus restrictions weighed on the price of oil, one of Canada's major exports, even as tugboats struggled to move a stranded container ship blocking crude oil carriers in the Suez Canal.

US crude prices fell 3.1% to $59.3 a barrel, while the Canadian dollar was trading nearly unchanged at 1.2577 to the greenback, or 79.51 US cents.

It traded in a range of 1.2546 to 1.2595. On Wednesday, it touched its weakest since March 11 at 1.2608.

Ontario, Canada's most populous province, on Wednesday outlined a long-term plan to balance its budget as the economy recovers from the coronavirus crisis. It forecast a narrower deficit in 2021-22 and further gradual declines in subsequent years even as it announced additional pandemic-related spending.

Canadian government bond yields were lower across a flatter curve in tandem with US Treasuries. The 10-year was down 2.4 basis points at 1.451%, extending its pullback from a 14-month high last Thursday at 1.677%.