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Canadian dollar weakens 0.1% against the greenback
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Touches its weakest since March 15 at 1.3804
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Retail sales rise 1.4% in January
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Canadian bond yields fall across curve
(Adds analyst quotes and details throughout; updates prices)
By Fergal Smith
TORONTO, March 24 (Reuters) - The Canadian dollar
weakened to a nine-day low against its U.S. counterpart on
Friday before recouping much of its decline, as investors
weighed global banking sector stress and data showing some major
sectors of Canada's economy weakening in February.
The loonie was trading 0.1% lower at 1.3730 to the
greenback, or 72.83 U.S. cents, after touching its weakest level
since March 15 at 1.3804. For the week, the currency was barely
changed.
The move came as the U.S. dollar rallied against a
basket of major currencies and the price of oil, one of Canada's
major exports, settled 1% lower at $69.26 a barrel.
"Global risk aversion and equities are in the driver's seat
for USD-CAD today," said Jay Zhao-Murray, a market analyst at
Monex Canada Inc.
Some dialing back of the "fear trade" helped the loonie pare
its decline, Zhao-Murray added.
Wall Street bounced back from an earlier sell-off at the end
of a tumultuous week as U.S. Federal Reserve officials calmed
investor skittishness over a potential liquidity crisis in the
banking sector.
Still, the turmoil has led to investors betting that major
central banks, such as the Bank of Canada, will shift to cutting
interest rates this year. Money markets see a nearly 40% chance
that the central bank will ease at its next policy decision on
April 12. Canadian retail sales rose 1.4% in January, data from
Statistics Canada showed. But flash estimates for February
showed a decline of 0.6% as well as declines for wholesale trade
and manufacturing sales, down 1.6% and 2.8% respectively.
Canadian government bond yields were lower across the curve,
tracking the move in U.S. Treasuries.
The 2-year touched its lowest since August 2022
at 3.254% before recovering to 3.422%, down 3.1 basis points on
the day.
(Reporting by Fergal Smith; editing by Jonathan Oatis and
Sandra Maler)
