By Commodity News Service Canada
WINNIPEG, July 9 – The Canadian dollar was stronger relative to the US dollar on Wednesday, lifted by better than expected domestic housing data, analysts said.
According to the Canada Mortgage Housing Corp., Canadian housing starts increased to a seasonally adjusted annual pace of 198,185 units in June, up from 196,993 units the month prior. Pre-report expectations called for housing starts to drop to 190,000 units in June.
The Canadian dollar closed at US$0.9381 or US$1=C$1.0660 on Wednesday, which compares with Tuesday’s North American settlement of US$0.9366 or US$1=C$1.0677.
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Signs of recovery within the Canadian economy were also supportive, as was strength seen in gold prices on Wednesday. Though, a weaker tone in crude oil weighed on the Canadian currency.
Traders were looking ahead to Friday’s Canadian employment data, which is expected to show the unemployment rate was steady and 24,000 new jobs were created in June.
Canadian bonds closed mixed on Wednesday, as traders were squaring positions ahead of Friday’s domestic jobs data, brokers said.
The two-year bond yielded 1.123% late Wednesday, from 1.114% late Tuesday. The 10-year bond yielded 2.245%, from 2.253%. Bond yields fall as their prices rise.
