By Commodity News Service Canada
WINNIPEG, May 22 – The Canadian dollar closed firmer relative to the US dollar on Thursday, as traders were covering positions ahead of Friday’s Canadian consumer price index data from Statistics Canada, analysts said.
Economists expect annual inflation for all items Canada was at 2 per cent in April, up from a 1.5 per cent jump in March. The 2 per cent mark would be the highest in two years.
The Canadian dollar closed at US$0.9180 or US$1=C$1.0893 on Thursday, which compares with Wednesday’s North American settlement of US$0.9162 or US$1=C$1.0915.
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Some spillover support also came from the gains seen in commodity prices including gold and copper. Though, weakness in crude oil values was bearish.
The Canadian dollar’s upside was also limited by disappointing Canadian retail sales data. Statistics Canada reported retail sales fell 0.1 per cent in March, while expectations called for a slight increase.
Canadian bonds closed lower on Thursday, following the same action seen in the US Treasury market, industry watchers said.
The two-year bond yielded 1.053% late Thursday, from 1.050% late Wednesday. The 10-year bond yielded 2.324%, from 2.302%. Bond yields fall as their prices rise.
