Canadian forex review: C$ softens after quiet day

By Commodity News Service Canada

WINNIPEG, May 25 – The Canadian dollar closed slightly softer Monday, but lacked direction as US markets were closed for Memorial Day.

The Canadian dollar closed at US$0.8121 or US$1=C$1.2313 on Monday, which compares with Friday’s North American settlement of US$0.8129 or US$1=C$1.2301.

Weakness in crude oil values and ongoing worries about slow economic growth in Canada put downward pressure on the Canadian currency.

Though, traders still believe the US Federal Reserve will wait until later in the year before raising interest rates, which provided some short term support for the loonie.

Canadian bonds were mixed Monday, after a day of rangebound activity as the market lacked direction while US markets were closed.

The two-year bond yielded 0.674% Monday, from 0.680% late Friday. The 10-year bond yield was at 1.786%, from 1.771%. Bond yields fall as their prices rise.