Canadian forex review: C$ holding steady

By Commodity News Service Canada

WINNIPEG, July 23 – The Canadian dollar was holding steady on Thursday, as the market took a breather after hitting its lowest levels in more than a decade on Wednesday, analysts said.

The Canadian dollar closed at US$0.7669 or US$1=C$1.3039 on Thursday, which compares with Wednesday’s North American settlement of US$0.7670 or US$1=C$1.3037.

Some support came from positive Canadian retail sales data. Statistics Canada said retail sales rose 1.0 per cent to C$43.0 billion in May, which beat expectations of a 0.5 per cent jump.

On the other side, weakness in crude oil and worries about the Bank of Canada possibly making another rate cut were bearish, as were expectations that the US Federal Reserve will raise interest rates later this year.

Canadian bonds were mostly higher on Thursday, reacting to weakness in crude oil values and worries about slow Canadian economic growth, brokers said.

The two-year bond yielded 0.427% on Thursday, which compares to 0.435% on Wednesday. The 10-year bond yield was at 1.502%, from 1.543%. Bond yields fall as their prices rise.