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Canadian dollar weakens 0.5% against the greenback
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Touches its strongest since Nov. 25 at 1.3323
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Price of U.S. oil rises 0.5%
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10-year yield touches a near four-week low
TORONTO, Jan 13 (Reuters) – The Canadian dollar weakened against its U.S. counterpart on Friday, giving back much of its weekly gain, as recent improvement in risk appetite lost some traction.
The loonie was trading 0.5% lower at 1.3430 to the greenback, or 74.46 U.S. cents, after touching its strongest since Nov. 25 at 1.3323. For the week, it was on track to gain 0.1%, which would be its fourth consecutive weekly gain.
Wall Street’s main indexes fell, giving back some of their gains since the start of the year, as remarks from major U.S. bank executives deepened concerns about the Federal Reserve’s monetary tightening impacting economic growth.
It follows U.S. data on Thursday that fueled hopes for a sustained downward trend in inflation, potentially giving the Fed room to scale down the size of its rate hikes.
Canada sends about 75% of its exports to the United States, including oil.
U.S. crude futures were up 0.5% at $78.75, adding to this week’s gains, helped by the prospect of less aggressive tightening by the Fed and signs of demand growth in top oil importer China.
Mexico, the United States and Canada plan to produce in North America 25% of what they currently import from Asia under a new drive to promote the integration of the region’s economy, Mexican Foreign Minister Marcelo Ebrard said on Thursday.
Canadian consumer price index data for December, due next Tuesday, could offer clues on the Bank of Canada policy outlook. Economists expect inflation to ease to an annual rate of 6.3% from 6.8% in November.
Canadian government bond yields were mixed across the curve on Friday. The 10-year touched its lowest level since Dec. 19 at 2.882% before recovering slightly to 2.891%, down one basis point on the day. (Reporting by Fergal Smith)
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