Market News

CANADA FX DEBT-C$ steadies after hitting a 2-year low as oil rallies - REUTERS

SEPTEMBER 22, 2022

       * Loonie touches its weakest since July 2020 at 1.3544

        * Price of U.S. oil rises 3.5%

        *  Canadian bond yields rise across curve

    By Fergal Smith
       TORONTO, Sept 22 (Reuters) - The Canadian dollar
steadied against its U.S. counterpart on Thursday as oil prices
rose and the sell-off in global equity markets lost some
momentum, with the currency rebounding from its weakest level in
more than two years.
    The price of oil, one of Canada's major exports, rose as the
prospect of higher Chinese demand and heightened geopolitical
risks outweighed recession fears.             
    U.S. crude        prices were up 3.5% at $85.88 a barrel,
while stocks globally          clawed back some earlier declines
as investors assessed the economic impact of a wave of central
bank interest rate hikes, including a 75-basis point move by the
Federal Reserve on Wednesday.             
    "Equity market trends remain the most important determinant
of the CAD's performance in the short run," Shaun Osborne, chief
currency strategist at Scotiabank, said in a note.
    The Canadian dollar        was trading nearly unchanged at
1.3460 to the greenback, or 74.29 U.S. cents, after touching its
weakest intraday level since July 2020 at 1.3544.    
    Canada's retail sales data for July, due on Friday, could
help guide expectations for further tightening from the Bank of
    Canadian government bond yields were higher across the
curve, tracking the move in U.S. Treasuries.
    The 10-year             rose 6.7 basis points to 3.109% but
fell 3.5 basis points further below the equivalent U.S. rate to
a gap of 50.5 basis points.
 (Reporting by Fergal Smith; editing by Jonathan Oatis)


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