Market News

Canadian dollar steadies amid short-covering rally in G10 FX - REUTERS

SEPTEMBER 29, 2023

  • Loonie trades in a range of 1.3471 to 1.3516
  • Price of U.S. oil falls 2.2%
  • Canadian bond yields ease across the curve

TORONTO, Sept 28 (Reuters) - The Canadian dollar was little changed against its U.S. counterpart on Thursday as investors took stock of recent market moves ahead of a possible U.S. government shutdown, with the currency steadying a day after hitting a two-week low.

The loonie was trading nearly unchanged at 1.35 to the greenback, or 74.07 U.S. cents, after moving in a range of 1.3471 to 1.3516.

On Wednesday it touched its weakest intraday level since Sept. 15, at 1.3542. Still, it has held up better than most other G10 currencies in recent weeks.

"Ahead of the Chinese holiday tomorrow that extends into all of next week and ahead of a possible closure of the U.S. government, you've seen a short-covering rally in most of the major currencies," said Marc Chandler, chief market strategist at Bannockburn Global Forex LLC. "The market is not as short Canada and it's had less of a bounce."

The Democratic-led U.S. Senate forged ahead with a bipartisan stopgap funding bill aimed at averting a fourth partial government shutdown in a decade, while the House of Republicans prepared to vote on partisan Republican spending bills that have no chance of becoming law.

The U.S. dollar (.DXY) eased from a 10-month high against a basket of major currencies as investors stayed on guard for potential intervention in the yen.

The price of oil, one of Canada's major exports, was down 2.2% at $91.6 a barrel, giving back some recent gains.

Canadian job vacancies declined 5.8% to 701,300 in July, extending a steady downward trend since June 2022, Statistics Canada said.

Canadian government bond yields were lower across the curve, tracking moves in U.S. Treasuries. The 10-year eased about half a basis point to 4.090%, after earlier touching its highest level since December 2007 at 4.165%.

Reporting by Fergal Smith; Editing by Leslie Adler


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