The Canadian dollar strengthened against its US counterpart on Friday, lagging behind some other commodity-linked currencies but recovering from a one-month low the day before as investors grew more hopeful about a US-China trade deal.

At 3:18 p.m. (2018 GMT), the Canadian dollar was trading 0.2% higher at 1.3226 to the greenback, or 75.61 US cents. The currency, which hit a one-month low at 1.3270 on Thursday, traded in a range of 1.3217 to 1.3252. For the week, the loonie was nearly unchanged.

Canadian government bond prices were lower across the yield curve in sympathy with US Treasuries as increased risk appetite reduced demand for government bonds. The 10-year fell 21 Canadian cents to yield 1.487%. On Thursday, the 10-year yield touched its lowest intraday level since Nov. 4 at 1.464%.

Foreign investors bought a net C$4.76 billion in Canadian securities in September, Statistics Canada said on Friday. Separate data from the Canadian Real Estate Association showed homes sales held steady in October.

Wall Street's main stock indexes hit record highs after White House economic adviser Larry Kudlow said on Thursday that the United States and China were nearing a deal.

Canada is a major exporter of commodities, including oil, so its economy could benefit from an improved global trade outlook. US crude oil futures settled 1.7% higher at $57.72 a barrel.

Copyright Reuters, 2019

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