*
Canadian dollar strengthens 0.1% against the greenback
*
Touches its strongest intraday since Feb. 3 at 1.3326
*
Price of U.S. oil settles 0.5% higher
*
10-year yield touches a one-month high at 3.177%
(Adds strategist quotes and details throughout; updates prices)
By Fergal Smith
TORONTO, Feb 13 (Reuters) - The Canadian dollar
strengthened to a 10-day high against its U.S. counterpart on
Monday as investors bet the Bank of Canada is not yet finished
raising interest rates following recent data showing surprising
strength in the domestic jobs market.
Canada's central bank has signaled a pause in its tightening
campaign to assess how well rate hikes are working to slow the
economy and lower inflation.
Data on Friday showed that the Canadian economy added
150,000 jobs in January, smashing expectations for a gain of
15,000.
"It might be unrealistic to believe that one number could make them change their minds so much but the market has had a dramatic reaction," said Marc Chandler, chief market strategist at Bannockburn Global Forex LLC. Money markets see a roughly 85% chance that the BoC will raise its benchmark rate by July after having expected the central bank's next move to be a cut before the release of the employment data. "In the context of the market moving closer to the Fed (Federal Reserve) view that it is getting more aggressive on U.S. rates, that pendulum is also swinging with the help of strong jobs data in favor of another hike in Canada," Chandler said. The Canadian dollar traded 0.1% higher at 1.3330 to the U.S. dollar, or 75.02 U.S. cents, after touching its strongest intraday level since Feb. 3 at 1.3326. The modest gain for the loonie came as the U.S. dollar lost ground against a basket of major currencies and the price of oil, one of Canada's major exports, rose. U.S. crude prices settled 0.5% higher at $80.14 a barrel. Canadian government bond yields were mixed across the curve. The 10-year eased 2.8 basis points to 3.129% after touching its highest intraday since Jan. 9 at 3.177%. (Reporting by Fergal Smith; editing by Barbara Lewis and Deepa Babington)
