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The Canadian dollar CADUSD edged lower against its U.S. counterpart on Monday as recent softer-than-expected domestic inflation data continued to weigh on the currency and despite higher oil prices.

The loonie was 0.1% lower at 1.3518 to the U.S. dollar, or 73.98 U.S. cents, after trading in a range of 1.3496 to 1.3528.

“A lingering hangover from last week’s CPI data has the Canadian dollar holding above the 1.35 mark today in some range-bound trading,” said Kyle Chapman, FX markets analyst at Ballinger & Co in London.

Data last Tuesday showed Canada’s annual inflation rate slowing to 2.9% in January, bringing forward bets for an early interest rate cut by the Bank of Canada. Money markets see a 42% chance the central bank would ease as soon as April.

“The loonie sputtered while much of the G10 capitalized on last week’s tech-fueled risk rally, weighed down by a softening rates outlook and an inert economy,” Chapman said.

Canadian wholesale trade fell 0.6% in January from December, preliminary data from Statistics Canada showed on Monday. Preliminary January factory sales data was more upbeat, showing an increase of 0.4% month-over-month.

The price of oil, a major Canadian export, was up 1.8% at $77.84 a barrel on expectations of tighter supply and the risk of disruptions to shipping, while Canadian bond yields rose across the curve, tracking moves in U.S. Treasuries.

The 10-year was up 4.5 basis points at 3.508%.

Canada plans to issue a Canadian-dollar-denominated green bond this week, the first such issue under an updated green bond framework that includes certain nuclear energy expenditures, the Department of Finance said in a statement.

Canada is the first sovereign borrower to include these types of expenditures in a green bond, the statement said.

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