Canadian forex review: C$ little changed

By Commodity News Service Canada

WINNIPEG, March 20 – The Canadian dollar was little changed relative to the US dollar on Thursday, consolidating after dropping sharply on Wednesday.

The Canadian dollar closed at US$0.8895 US$1=C$1.1242 on Thursday, which compares with Wednesday’s North American settlement of US$0.8893 US$1=C$1.1245.

The lack of movement was also linked to traders being cautious ahead of key Canadian economic data on Friday, analysts said. Statistics Canada is set to release Canadian inflation and retail sales data Friday morning.

Wednesday’s bearish news of possible interest rate cuts in Canada, and interest rate increases in the US, continued to weigh on the Canadian dollar.

Canadian bonds were lower Thursday, continuing to react to Wednesday’s US Federal Reserve statement that said interest rates may rise in the US next year, brokers said.

The two-year bond yielded 1.073% late Thursday, from 1.061% late Wednesday. The 10-year bond yielded 2.500%, from
2.474%. Bond yields fall as their prices rise.