By Commodity News Service Canada
WINNIPEG, June 3 – The Canadian dollar ended lower relative to the US dollar on Tuesday, as traders were being cautious ahead of Wednesday’s Bank of Canada policy announcement, analysts said. The trade generally expects the Bank of Canada will keep interest rates unchanged at one per cent.
The Canadian dollar closed at US$0.9166 or US$1=C$1.0910 on Tuesday, which compares with Monday’s North American settlement of US$0.9176 or US$1=C$1.0898.
A lack of interest in buying riskier assets, including the Canadian dollar, was also bearish, brokers said.
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However, the loonie’s downside was limited by some spillover support from the gains seen in commodities, such as crude oil and gold.
Traders were also looking ahead to Canadian merchandise trade data on Wednesday, as well as Canadian and US employment figures on Friday.
Canadian bonds closed lower on Tuesday amid expectations that the Bank of Canada will maintain their dovish outlook in Wednesday’s policy announcement, participants said.
The two-year bond yielded 1.073% late Tuesday, from 1.062% late Monday. The 10-year bond yielded 2.337%, from 2.281%. Bond yields fall as their prices rise.
