By Commodity News Service Canada
WINNIPEG, Jan. 15 – The Canadian dollar eased relative to the US dollar after a day of choppy activity on Thursday.
Currency markets were very volatile, reacting to the Swiss central bank’s unexpected decision to get rid of a previously imposed limit on the franc’s strength against the euro, brokers added.
The Canadian dollar closed at US$0.8358 or US$1=C$1.1964 on Thursday, which compares with Wednesday’s North American settlement of US$0.8372 or US$1=C$1.1945.
Downward pressure came from a drop in crude oil values, as it will likely have a negative impact on Canadian economic growth, analysts said.
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A report from the US Federal Reserve stating that the US economy grew at a moderate pace in December, aided by auto sales and good demand for other consumer products, added to the bearish tone.
However, disappointing US retail sales data released on Wednesday provided some support for the Canadian dollar, as did a rally in gold values.
Canadian bonds closed sharply higher again on Thursday, as investors continued flocking to save-haven assets amid falling crude oil values, market watchers said.
The two-year bond yielded 0.813% late Thursday, from 0.889% late Wednesday. The 10-year bond yielded 1.479%, from 1.574%. Bond yields fall as their prices rise.
