C$ weakens but on track for weekly gain as economy expands
TORONTO — The Canadian dollar weakened
against its U.S. counterpart on Friday but was on track for a
second straight weekly gain, as preliminary data showed the
domestic economy growing at a pace exceeding the Bank of
The Canadian economy grew at an annualized rate of 4.6% in
the second quarter over the first quarter, Statistics Canada
said in a flash estimate, adding that the economy was
essentially unchanged in May compared to April and that it
likely expanded 0.1% in June.
Canada’s central bank, which has been hiking interest rates
aggressively to tame high inflation, has projected 4% growth for
the second quarter.
The Canadian dollar was trading 0.4% lower at 1.2850
to the greenback, or 77.82 U.S. cents, after touching its
strongest intraday level since June 13 at 1.2790.
For the week, the currency was on track to advance 0.5%,
while it has edged 0.2% higher since the start of the month, as
the possibility that the Federal Reserve will raise interest
rates more slowly than previously anticipated boosted global
Stocks on Friday added to recent gains and the price of oil,
one of Canada’s major exports, rose as attention turned to next
week’s OPEC+ meeting and expectations that the oil producers
group will dash U.S. hopes for a supply boost.
U.S. crude prices were up 2.9% at $99.19 a barrel.
Canadian government bond yields clawed back some of their
recent decline, tracking the move in U.S. Treasuries and German
Bunds after second-quarter GDP data from the euro zone beat
The Canadian 10-year yield rose 4.9 basis points
to 2.669%, after earlier touching its lowest intraday level
since April 14 at 2.603%.
(Reporting by Fergal Smith; Editing by Paul Simao)