Article Highlights

  • Canadian dollar at C$1.3686, or 73.07 U.S. cents
  • Bond prices higher across the yield curve
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The Canadian dollar strengthened Wednesday against its U.S. counterpart as oil prices rose and after comments by U.S. Commerce Secretary Wilbur Ross appeared to represent another move to the center by the Trump administration.

Prices of oil, one of Canada’s major exports, rose after a larger-than-expected fall in U.S. crude inventories.

U.S. crude prices were up 1.57 percent at $46.6 a barrel.

Ross signaled on Tuesday in an interview with Reuters that the Trump administration would try to use existing tools to aggressively enforce trade rules and insist on fairer treatment for U.S. goods, rather than adopt the slash-and-burn approach U.S. President Donald Trump had discussed on the campaign trail in 2016.

At 9:29 a.m. ET (1329 GMT), the Canadian dollar was trading at C$1.3686 to the greenback, or 73.07 U.S. cents, up 0.2 percent, according to Reuters data.

The currency traded in a range of C$1.3678 to C$1.3732. Gains for the loonie came as the U.S. dollar dipped against a basket of major currencies, with news that Trump had abruptly fired FBI Director James Comey dampening some of this week’s strong risk appetite.

The loonie had hit a 14-month low on Friday at C$1.3793.

It has been pressured recently by lower commodity prices, concerns about a possible North American Free Trade Agreement renegotiation and investor wariness about how troubles at alternative lender Home Capital Group Inc could affect Canada’s real estate market.

Home Capital published data on Wednesday showing depositors were continuing to withdraw funds but at a slower rate than before.

The Liberal Party squeaked to victory in British Columbia elections, but it lost its majority after 16 years in power which left the future of big oil and gas projects in the region unclear.

Canadian government bond prices rose across the yield curve in sympathy with U.S. Treasuries.

The two-year edged up 1 Canadian cent to yield 0.717 percent and the 10-year climbed 20 Canadian cents to yield 1.599 percent. (Reporting by Fergal Smith; Editing by Meredith Mazzilli)