Canadian forex review: C$ strengthens

By Commodity News Service Canada

WINNIPEG, September 10 – The Canadian dollar strengthened against its US counterpart on Tuesday, lifted by improved global risk sentiment, analysts said.

Traders were more willing to take on risk because it’s becoming more unlikely that the US will take military action against the Syrian government.

The Canadian currency was quoted at US$0.9664, or US$1=C$1.0348 at the close on Tuesday, which compares with Monday’s North American close of US$0.9640, or US$=C$1.0373.

Some of the strength in the Canadian dollar was also linked to positive Chinese economic data.

However, spillover pressure from the losses seen in crude oil and gold and weak Canadian housing starts data limited the upside. According to the Canada Housing and Mortgage Corporation, housing starts fell to 180,291 in August, from 193,021 in July.

Canadian bonds moved lower on Tuesday, with the sell-off linked to easing concerns about conflict in Syria and strong Chinese economic data, brokers said.

The two-year bond yielded 1.308% late Tuesday, from 1.285% late Monday. The 10-year bond yielded 2.811%, from 2.747%. Bond yields fall as their prices rise.