By Commodity News Service Canada
WINNIPEG, July 30 – The Canadian dollar weakened against the US dollar on Thursday, following the softening crude oil market, analysts said.
The Canadian dollar closed at US$0.7686 or US$1=C$1.3010 on Thursday, which compares with Wednesday’s North American settlement of US$0.7726 or US$1=C$1.2944.
Ongoing expectations that the US Federal Reserve will raise interest rates later this year, after they pointed to continued growth in the US economy on Wednesday, added to the bearish tone.
Worries about economic problems in China, and a possible move into recession for the Canadian economy, further undermined the loonie.
However, the losses were limited by short covering ahead of Friday’s Canadian gross domestic product report. Pre-report expectations call for May Canadian GDP to be flat, traders said.
Canadian bonds were stronger on Thursday, recovering from Wednesday’s declines as traders squared positions ahead of the end of the month, brokers said.
The two-year bond yielded 0.456% on Thursday, from 0.465% on Wednesday. The ten-year bond yield was at 1.500%, from 1.528%. Bond yields fall as their prices rise.
