CANADA FX DEBT – Canadian Dollar Slides on US Dollar Buy Wave

(Adds analyst quotes and details throughout; updates prices)


The Canadian dollar weakens by 0.7% against the greenback


Trades in a range of 1.3504 to 1.3695


Canadian exports fall 2.9% in August


10-year yield rises 14.9 basis points to 3.277%

TORONTO, Oct 5 (Reuters) – The commodity-linked Canadian dollar weakened against its U.S. counterpart on Wednesday as the greenback broadly appreciated and domestic data showed falling exports in August, with the loonie losing ground despite rising oil prices.

The Canadian dollar fell 0.7% to 1.36 against the greenback, or 73.53 US cents, after trading in a range of 1.3504 to 1.3695. The currency retreated from its highest intraday level in 11 days on Tuesday at 1.3501.

“It looks like a massive buying wave of US dollars,” said Erik Nelson, currency strategist at Wells Fargo in New York. “Notably, the rebound in oil and equity prices provides only minimal support for the Canadian dollar here against a resilient greenback.”

The U.S. dollar rallied against a basket of major currencies, with data showing U.S. private employers stepped up hiring in September and the Reserve Bank of New Zealand raised interest rates to a high of seven years, promising more trouble to come.

New Zealand’s central bank’s stance contrasted with a dovish turn from the Reserve Bank of Australia on Tuesday, which helped boost investor sentiment around the world on hopes that other central banks would ease. the tightening.

The RBNZ decision dispelled “some expectations of a central bank rate pivot,” Shaun Osborne, chief currency strategist at Scotiabank, said in a note.

Canada’s trade surplus narrowed to C$1.5 billion ($1.1 billion) in August as exports fell 2.9%.

One of Canada’s main exports is oil. It added to its gains in recent days as OPEC+ agreed to its biggest production cuts since the 2020 COVID-19 pandemic.

U.S. crude prices stood 1.4% higher at $87.76 a barrel, while Canadian government bond yields were higher on a steeper curve, following the move in U.S. Treasuries .

The 10-year rose 14.9 basis points to 3.277%. (Reporting by Fergal Smith; Editing by Andrea Ricci and Jonathan Oatis)

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