TORONTO: The Canadian dollar rose against the greenback on Monday as pressure on stocks due to the recent jump in bond yields faded and data showed narrowing in Canada's current account deficit, with the loonie rebounding from a two-week low on Friday.

World shares jumped as bond yields stayed below their recent spikes and optimism over a swift economic recovery was fueled by Johnson & Johnson's newly approved COVID-19 vaccine and progress in a new US $1.9 trillion coronavirus relief package.

Canada sends about 75% of its exports to the United States, including oil. US crude prices were up 0.9% at $62.03 a barrel, helped by growing factory activity in Europe.

Canada's current account deficit narrowed to C$7.3 billion in the fourth quarter from a revised C$10.5 billion deficit in the third quarter, Statistics Canada said.

The Canadian dollar was trading 0.6% higher at 1.2668 to the greenback, or 78.94 US cents, having traded in a range of 1.2665 to 1.2738.

On Friday, the loonie fell 1%, its biggest decline since last June, while it touched its weakest since Feb. 12 at 1.2748.

Speculators have raised their bullish bets on the Canadian dollar, data from the US Commodity Futures Trading Commission showed on Friday. As of Feb. 23, net long positions had increased to 9,132 contracts from 8,164 in the prior week.

Canada's C$100 billion stimulus plan is justified by the economic hole caused by the COVID-19 pandemic, government sources said, as analysts warned Ottawa against racking up too much debt and making investments that fail to boost growth.

Canada's fourth quarter GDP data is due on Tuesday.

Canadian government bond yields were higher across much of the curve, with the 10-year up 4.4 basis points at 1.401%. On Friday, it touched its highest intraday since January last year at 1.501%.