TORONTO: The Canadian dollar edged lower against its US counterpart on Monday as oil prices fell, but the currency traded in a narrow range ahead of key economic data and a Federal Reserve interest rate decision later in the week.
The price of oil, one of Canada's major exports, extended a Friday decline that halted a weeks-long rally, after President Donald Trump demanded that producer club OPEC raise output to soften the impact of US sanctions against Iran.
US crude prices were down 0.2pc at $63.15 a barrel.
Canada's gross domestic product data for February is due on Tuesday, which could help guide expectations for economic growth in the first quarter.
Last week, the Bank of Canada lowered its growth forecast for 2019, to 1.2pc from 1.7pc and held its benchmark interest rate steady at 1.75pc as it worried about a number of headwinds for the domestic economy, including trade uncertainty.
An expanding list of Canadian farm exports is hitting obstacles at Chinese ports, leaving sellers of soybeans, peas and pork scrambling amid a bitter diplomatic dispute.
The US central bank will announce its policy decision on Wednesday, with Fed Chairman Jerome Powell expected to balance the strong US growth data against persistent concerns over the outlook for global growth.
At 8:43 a.m. (1243 GMT), the Canadian dollar was trading 0.1pc lower at 1.3474 to the greenback, or 74.22 US cents.
The currency, which touched a nearly four-month low at 1.3522 last Wednesday, traded in a range of 1.3450 to 1.3479.
Speculators have cut their bearish bets on the Canadian dollar, data from the US Commodity Futures Trading Commission and Reuters calculations showed on Friday.
As of April 23, net short positions had fallen to 47,493 contracts after rising to the highest since January at 49,162 in the prior week.
Canadian government bond prices were mixed across the yield curve, with the two-year price up 1 Canadian cent to yield 1.541pc and the 10-year falling 7 Canadian cents to yield 1.694pc.
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