CANADA’S FX DEBT – Canadian dollar stabilizes as investors wait for clues on Fed outlook

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* The Canadian dollar strengthens 0.2% against the greenback * The price of US oil increases 0.5% * The Canadian 10-year yield hits a 4-1 / 2-month low at 1.283% TORONTO, 7 July (Reuters) – The Canadian dollar edged up against its US counterpart on Wednesday as oil prices rose and investors turned to the minutes of the Federal Reserve’s latest policy meeting, the currency turned stabilizing after hitting a two-month low on Tuesday. Oil, one of Canada’s top exports, gained ground after steep losses the day before, with support from a tight market in the near term after OPEC + talks collapsed this week with no deal to boost the offer. U.S. crude prices rose 0.5% to $ 73.73 a barrel, while the Canadian dollar traded 0.2% to 1.2442 for the greenback, or 80.37 cents US. On Tuesday, it touched its lowest intraday level since April 23 at 1.2494 before ending down 1%. Investors are worried about riskier assets, including commodity-linked currencies like the Canadian dollar, ahead of the Fed’s policy briefing in June. The minutes will likely show how serious members are about reducing their asset purchases and how early interest rate hikes could begin. The Canadian jobs report for June is due Friday, which may offer clues to the outlook for Bank of Canada policy. Some analysts expect the BoC to cut back on bond purchases again when interest rates are announced next week. Canadian government bond yields were lower on much of a flatter curve, following the movement of US Treasuries. The 10-year hit its lowest level since February 24 at 1.283% before recovering slightly to 1.291%, down 2.6 basis points on the day. (Reporting by Fergal Smith; editing by Jonathan Oatis)


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