Canadian forex review: C$ recovers from early weakness

By Commodity News Service Canada

WINNIPEG, May 28 – The Canadian dollar closed slightly higher against the US dollar on Thursday, recovering from early sharp losses seen earlier in the day.

The Canadian dollar closed at US$0.8042 or US$1=C$1.2435 on Thursday, which compares with Wednesday’s North American settlement of US$0.8026 or US$1=C$1.2459.

Sentiment that recent losses were overdone, after the Canadian currency fell below 80 cents US earlier in the day, was supportive.

A rebound in crude oil values was also bullish, as was a sell-off in the US dollar as traders await fresh news about the economic situation in Greece.

Though, disappointing Canadian economic data limited the upside. Statistics Canada said Canada’s current account deficit expanded by C$4.4 billion to C$17.5 billion in the first quarter of 2015, marking the second largest recorded deficit.

Canadian bonds were slightly higher on Thursday, following the US Treasury market as traders evened positions ahead of Canadian gross domestic product data on Friday.

The two-year bond yielded 0.620% Thursday, from 0.629% late Wednesday. The 10-year bond yield was at 1.660%, from 1.665%. Bond yields fall as their prices rise.