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CANADA FX DEBT-Loonie rises as U.S. data boosts Canada's exports outlook

Fergal Smith

(Adds strategist quote and details throughout; updates prices)

* Canadian dollar rises 0.1% against the greenback

* Price of U.S. oil increases 0.3%

* Canadian bond prices fall across a steeper yield curve

TORONTO, April 29 (Reuters) - The Canadian dollar edged higher against its U.S. counterpart on Monday as oil prices rose and data showing higher U.S. consumer spending bolstered prospects for Canada's exports. U.S. consumer spending increased by the most in more than 9-1/2 years in March as households stepped up purchases of motor vehicles, but price pressures remained muted, with a key inflation measure posting its smallest annual gain in 14 months.

"The possibility that the U.S. continues to operate as the consumer of last resort for the global economy would help to brighten Canada's export prospects," said Karl Schamotta, director global markets strategy at Cambridge Global Payments. Canada sends about 75% of its exports to the United States, including oil. The price of oil rose as the market attempted to resume a weeks-long rally that was halted on Friday when U.S. President Donald Trump demanded that producer club OPEC raise output to soften the impact of U.S. sanctions against Iran.

U.S. crude prices settled 0.3% higher at $63.50 a


At 4:09 p.m. (2009 GMT), the Canadian dollar was

trading 0.1% higher at 1.3448 to the greenback, or 74.36 U.S. cents. The currency, which touched a nearly four-month low at 1.3522 last Wednesday, traded in a range of 1.3440 to 1.3479.

The U.S. dollar fell against a basket of currencies,

slipping further from a 23-month high, ahead of a Federal Reserve interest rate decision on Wednesday. Traders awaited more data to convince them whether to add to their bullish positions in the greenback. Canada's gross domestic product data for February is due on Tuesday, which could help guide expectations for economic growth in the first quarter. Last week, the Bank of Canada lowered its growth forecast for 2019 to 1.2% from 1.7% and held its benchmark interest rate steady at 1.75% as it worried about a number of headwinds for the domestic economy, including trade uncertainty. An expanding list of Canadian farm exports is hitting obstacles at Chinese ports, leaving sellers of soybeans, peas and pork scrambling amid a bitter diplomatic dispute.

Canadian government bond prices were lower across a steeper yield curve in sympathy with U.S. Treasuries. The two-year fell 3.5 Canadian cents to yield 1.564% and the

10-year declined 33 Canadian cents to yield 1.722%.

(Reporting by Fergal Smith; Editing by Paul Simao and Peter Cooney)