Canadian dollar set for quarterly gain as economic growth accelerates
TORONTO (Reuters) – The Canadian greenback weakened in opposition to its U.S. counterpart on Thursday, however was on monitor for a first-quarter achieve as a preliminary estimate exhibiting that Canadian financial development accelerated in February offset a slide in oil costs.
The value of oil, one in every of Canada’s main exports, plunged on information that america was contemplating the discharge of 180 million barrels from its Strategic Petroleum Reserve, which might be the biggest such transfer for the reason that SPR was created within the Seventies.
U.S. crude costs have been down 4.9% at $102.55 a barrel, whereas the safe-haven U.S. greenback gained floor in opposition to a basket of main currencies as warning about developments in Ukraine weighed on the euro.
The Canadian financial system gathered appreciable momentum in February, rising 0.8%, following a January achieve of 0.2% that met expectations, information from Statistics Canada confirmed.
Nonetheless, traders have dialed again expectations for an upsized rate of interest hike on the Financial institution of Canada’s coverage announcement on April 13.
Possibilities of the central financial institution mountain climbing charges by half of a proportion level somewhat than the traditional quarter-percentage-point transfer have fallen to 50% from practically 80% earlier within the week, cash market information reveals.
The Canadian greenback was 0.2% decrease at 1.2507 to the buck, or 79.96 U.S. cents, after buying and selling in a spread of 1.2477 to 1.2533.
On Wednesday it touched its strongest intraday degree in practically 5 months at 1.2427. For the month, it was on monitor to realize 1.3%, whereas it has superior 1% for the reason that begin of the yr.
Canadian authorities bond yields eased throughout the curve, monitoring the transfer in U.S. Treasuries. The ten-year dipped 2.1 foundation factors to 2.416%, after bearing on Tuesday its highest degree in additional than three years at 2.607%.
(Reporting by Fergal Smith; Modifying by Paul Simao)
