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The Canadian dollar fell against its broadly stronger U.S. counterpart on Wednesday, pulling back from a near three-year high hit earlier in the day when markets priced in a Democrat win in the U.S. Senate run-off election in Georgia.

The loonie was trading 0.3 per cent lower at 1.2704 to the greenback, or 78.72 U.S. cents. It touched its strongest intraday level since April 2018 at 1.2630 before turning lower.

On Tuesday, the loonie notched its biggest gain since June.

U.S. bond yields rose and tech stocks fell on Wednesday on the prospect of more stimulus and tougher regulation if Democrats take control of the U.S. Senate following the Georgia election.

Canada sends about 75 per cent of its exports to the United States, including oil.

Oil prices rose to their highest since late February after Saudi Arabia announced a big voluntary production cut and as an industry report showed U.S. inventories fell last week.

U.S. crude prices were up 0.2 per cent at $50.05 a barrel, while the U.S. dollar gained ground against a basket of major currencies, recovering from its lowest level in nearly three years.

Canadian government bond yields were higher across much of a steeper curve in sympathy with U.S. Treasuries. The 10-year rose 3.7 basis points to 0.750 per cent. It touched its highest since Dec. 16 at 0.767 per cent.

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