TORONTO (Reuters) – The Canadian dollar strengthened against its U.S. counterpart and all the other G10 currencies on Tuesday, as oil prices climbed to a one-year high and the prospect of more U.S. economic stimulus bolstered risk appetite.
Global stock markets gained for a second straight day as U.S. President Joe Biden appeared poised to push forward with his proposed $1.9 trillion pandemic relief plan even if it fails to draw Republican support, while retail investors retreated from video game retailer GameStop Corp and their new-found interest in silver.
Canada sends about 75% of its exports to the United States, including oil. U.S. crude prices were up 2.6% at $54.92 a barrel after major crude producers showed they were reining in output roughly in line with their commitments.
The Canadian dollar was trading 0.2% higher at 1.2822 to the greenback, or 77.99 U.S. cents, having traded in a range of 1.2781 to 1.2858.
It was one of just three G10 currencies to gain ground against the greenback. The New Zealand dollar and the Norwegian crown both edged 0.1% higher.
Canadian house prices will continue their upwards march this year, outpacing inflation after hitting record highs in 2020, according to a Reuters poll of property market analysts who said the risk of a COVID-19 resurgence derailing activity was low.
Canada’s employment report for January is due on Friday, which could help guide Bank of Canada interest rate expectations.
Canadian government bond yields were higher across the curve in tandem with U.S. Treasuries. The 10-year rose 3.1 basis points to 0.914%, approaching the 10-month high it touched on Friday at 0.922%.
(Reporting by Fergal Smith; Editing by Paul Simao)
