By Commodity News Service Canada
WINNIPEG, May 7 – The Canadian dollar eased relative to the US dollar on Wednesday, seeing a correction following Tuesday’s sharp advance, analysts said.
The Canadian dollar closed at US$0.9179 or US$1=C$1.0894 on Wednesday, which compares with Tuesday’s North American settlement of US$0.9192 or US$1=C$1.0879.
Some of the weakness was linked to disappointing Canadian building permits data. Statistics Canada reported that building permit applications declined by 3 per cent in March, while pre-report expectations called for a 3.5 per cent gain.
Sharp declines seen in gold prices were also bearish for the Canadian dollar. But, stronger crude oil values limited the downside.
Positioning ahead of Canadian employment data on Friday also kept the Canadian dollar from dropping further against the US dollar, brokers added.
Canadian bonds closed little changed amid a lack of fresh market moving news on Wednesday, industry officials said.
The two-year bond yielded 1.074% late Wednesday, from 1.072% late Tuesday. The 10-year bond yielded 2.378%, from 2.374%. Bond yields fall as their prices rise.
