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The Canadian dollar strengthened against the greenback on Monday as global stocks rose and Bank of Canada Governor Stephen Poloz said the economy will need significant monetary stimulus in the rebuilding stage of the coronavirus crisis.

A survey showing that German business morale rebounded in May boosted investor sentiment. Shares globally gained 0.5%, while U.S. crude futures were up 1.4% at $33.72 a barrel. Oil is one of Canada’s major exports.

The Canadian dollar was trading 0.1% higher at 1.3980 to the greenback, or 71.53 U.S. cents.

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With financial markets in the United States closed for a public holiday, the currency traded in a tight range of 1.3968 to 1.4007. Last week, the loonie rose 0.8%.

Poloz, whose successor Tiff Macklem takes over on June 3, said the central bank’s dominant concern has been with the possibility that deflation could emerge and that its policy framework gives it flexibility in the time it takes to get inflation back to target.

The central bank, which has slashed its benchmark interest rate to near zero, has estimated the level of GDP to be as much as 3% lower in the first quarter and as much as 30% lower in the second quarter than it was in the fourth quarter of 2019. Canada’s first-quarter GDP report is due on Friday.

Canadian government bond yields were mixed across a flatter curve on Monday, with the 10-year yield down 1.9 basis points at 0.488%.

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