The Canadian dollar steadied against its U.S. counterpart on Monday as the greenback slipped against a basket of currencies and investors awaited clues on prospects for the NAFTA trade pact.
At 3:34 p.m., the Canadian dollar was trading nearly unchanged at $1.3160 to the greenback, or 75.99 U.S. cents.
The currency, which touched on Thursday its weakest in nearly seven weeks at $1.3226, traded in a narrow range of $1.3151 to $1.3197.
The loonie has gyrated in recent days on hawkish comments by a senior Bank of Canada, weaker-than-expected domestic jobs data and an uncertain outlook for the North American Free Trade Agreement, but there was little impetus at the start of the week for investors to trade off.
“In Canada, there is no news, there is no data,” said Alvise Marino, an FX strategist at Credit Suisse in New York. “On the NAFTA front, we are in the same holding pattern that we were before.”
Canada must end its low-price milk proteins policy to reach a U.S.-Canadian deal to update the North American Free Trade Agreement, U.S. Agriculture Secretary Sonny Perdue said in an interview aired on Sunday on C-SPAN television.
Talks on NAFTA are expected to resume after U.S. Trade Representative Robert Lighthizer travels to Brussels for trade talks with European Union trade commissioner Cecilia Malmstrom on Monday.
The U.S. dollar lost ground after the European Union’s top negotiator said an agreement for Britain to leave the economic bloc might be reached in the coming weeks, boosting the euro and sterling .
The price of oil, one of Canada’s major exports, fell after data suggested U.S. crude inventories might build. U.S. crude oil futures settled 0.3 per cent lower at $67.54 a barrel.
Speculators have raised bearish bets on the Canadian dollar, data from the U.S. Commodity Futures Trading Commission and Reuters calculations showed on Friday. As of Sept. 4, net short positions had increased to 26,307 contracts from 24,789 a week earlier.
Canadian government bond prices were little changed across the yield curve, with the 10-year flat to yield 2.288 per cent. The 10-year yield touched its highest intraday since Aug. 30 at 2.312 per cent.