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Canadian dollar strengthens 0.1% against the greenback
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Touches its strongest since Feb. 24 at 1.3531
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Price of U.S. oil increases 1%
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2-year yield touches a two-week high at 3.788%
By Fergal Smith TORONTO, March 30 (Reuters) - The Canadian dollar strengthened to a one-month high against its U.S. counterpart on Thursday as oil prices rose and hopes that turmoil in the banking sector is over helped underpin risk appetite. Equity markets globally rose and the safe-haven U.S. dollar lost ground against a basket of major currencies as investors switched focus to inflation for more hints on central banks' next rate moves, as concerns over the banking sector receded. "Market action suggests that the wave of fear which had gripped markets earlier this month on banking worries continues to wash back out to sea," Colin Cieszynski, chief market strategist at SIA Wealth Management, said in a note. The price of oil, one of Canada's major exports, added to this week's gains as a surprise drop in U.S. crude stockpiles and a halt in exports from Iraq's Kurdistan region offset a smaller-than-expected cut to Russian supplies. U.S. crude prices rose 1% to $73.71 a barrel, while the Canadian dollar was trading 0.1% higher at 1.3535 to the greenback, or 73.88 U.S. cents, after touching its strongest since Feb. 24 at 1.3531. The currency is on track to gain 0.8% for the month
Canadian GDP data for January, due on Friday, could offer clues on the strength of the domestic economy. Analysts expect an increase of 0.3% from December. Canadian government bond yields were higher across a flatter curve. The 2-year rose 3.4 basis points to 3.788%, its highest since March 14, while the 10-year was up 2.2 basis points at 2.964%. Canada is due to auction C$1.5 billion ($1.1 billion) of 30-year bonds, with the bidding deadline set for 12 p.m. ET (1600 GMT). (Reporting by Fergal Smith; editing by Jonathan Oatis)
