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Canadian Dollar Gains 0.1% Against Dollar
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Trade between 1.3434 and 1.3489
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US oil prices rose 0.7%
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Canadian Bond Yields Ease Across Curve
TORONTO (Reuters) – The Canadian dollar strengthened against the U.S. on Wednesday as investors welcomed data showing lower U.S. inflation, but the currency weakened ahead of the Bank of Canada rate decision. Movement was limited.
The US consumer price index rose 5% in the 12 months to March, its smallest year-on-year gain since May 2021.
US stock index futures rallied and the price of oil, one of Canada’s main exports, joined the recent rally, rising 0.7% to $82.09 a barrel. Meanwhile, the US dollar fell against a basket of major currencies.
The Canadian dollar gained 0.1% to 1 US dollar at 1.3450, or 74.35 US cents, after trading between 1.3434 and 1.3489.
The Bank of Canada has already moved to the sidelines after raising its benchmark interest rate to 4.50%, the highest in 15 years.
The Bank of Canada is scheduled to announce its policy decision at 10:00 am Eastern Time (1400 GMT). Analysts expect interest rates to stay on hold as inflation falls and the global banking system is under stress despite faster growth in the first quarter.
Canadian government bond yields followed the movement of US Treasuries lower across the curve. The 10-year was down 4.5 basis points to 2.866%. (Reporting by Fergal Smith; Editing by Sharon Singleton)
