By Commodity News Service Canada
WINNIPEG, May 23 – The Canadian dollar closed firmer relative to the US dollar on Friday, with positive Canadian inflation data lifting the currency, analysts said.
Statistics Canada said the all-items consumer price index rose 2.0 per cent in the 12 months to April, which was in line with expectations. It also marked the first time inflation met the Bank of Canada’s target in two years.
The Canadian dollar closed at US$0.9199 or US$1=C$1.0870 on Friday, which compares with Thursday’s North American settlement of US$0.9180 or US$1=C$1.0893.
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Spillover support for the Canadian dollar also came from the firmer tone in crude oil and copper values. Though, weaker gold prices were bearish.
A lack of risk sentiment, due to some concerns about economic problems in other parts of the world, also limited the loonie’s upside.
Canadian bonds closed higher on Friday, as some global economic worries had traders flocking to safe-haven assets, participants said.
The two-year bond yielded 1.052% late Friday, from 1.054% late Thursday. The 10-year bond yielded 2.306%, from 2.324%. Bond yields fall as their prices rise.
