By Commodity News Service Canada
Winnipeg – June 3/13 – CNS – The Canadian dollar was trading
at a firmer level versus the US currency in late North American
activity on Monday. Much of the upswing in the value of the
Canadian currency came amid weak US economic data, market
watchers said.
The weak US data sparked investors to bail out of the US
dollar and into the Canadian unit.
The Canadian currency late in the afternoon was quoted at
C$1.0280 (97.27 US cents). This compares with Friday’s late
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The Canadian dollar joined a mix of currencies, such as the
euro, yen and Australian dollar, that gained against the US
dollar after the US ISM manufacturing number shrank in May,
showing contraction in the sector.
The US ISM manufacturing index moved to 49.0, below
expectations of 50.7 and showing contraction in activity on the
back of declines in new orders and production.
Strength in global crude oil helped to influence the upturn
in the Canadian dollar’s value, brokers said.
Canada will report merchandise trade figures for April on
Tuesday morning, while a policy decision from the Reserve Bank of
Australia could influence the Canadian unit during overnight
trade.
Economists believe Canada recorded a trade deficit of 500
million Canadian dollars ($486 million) in April, down from a
surplus of C$200 million in March, according to a report from the
Royal Bank of Canada.
Canadian bonds finished on a firmer footing along the yield
curve Monday with the strength associated with a gauge of the US
manufacturing sector that spooked investors to the safe haven
asset, market watchers said.
Canada’s two-year bond yield was at 1.075% Monday, from
1.084% Friday. The 10-year bond yielded 2.054%, from 2.064%.
Bond yields move inversely to bond prices.
North America’s bond markets saw decent gains after the
latest US Institute for Supply Management’s manufacturing figures
showed the index shrank to 49.0, below expectations of 50.7.
The ISM figure showed contraction in activity on the back of
declines in new orders and production.
END
