The US dollar fell against its rivals after sustaining its biggest weekly drop in four months last week as the Federal Reserve opened the doors for a rate cut as early as next month.

The price of oil, one of Canada's major exports, extended large gains last week that were prompted by tensions between Iran and the United States, as Washington was set to announce new sanctions on Tehran. US crude oil futures were up 0.4pc at $57.63 a barrel.

At 9:24 a.m. (1324 GMT), the Canadian dollar was trading 0.2pc higher at 1.3199 to the greenback, or 75.76 US cents.

The currency, which rose 1.4pc last week, traded in a range of 1.3178 to 1.3220.

Gains for the loonie came as global stocks were buoyed by hopes that a meeting later this week between presidents Donald Trump and Xi Jinping at the G20 summit in Japan would de-escalate a trade war that is damaging the global economy.

Canada runs a current account deficit, so its economy could benefit from an improved flow of global trade or capital.

Meanwhile, data from the US Commodity Futures Trading Commission and Reuters calculations showed on Friday that speculators have raised their bearish bets on the Canadian dollar for the first time in five weeks.

As of June 18, net short positions had increased to 38,071 contracts from 32,840 in the prior week.

Canadian government bond prices were higher across the yield curve in sympathy with US Treasuries.

The two-year rose 5.5 Canadian cents to yield 1.403pc and the 10-year

was up 34 Canadian cents to yield 1.448pc.

Canada's wholesale trade report for April is due on Tuesday and April gross domestic product data is due on Friday.