April 14 (Reuters) - The Canadian dollar edged back on Monday from an earlier five-month high against its U.S. counterpart as oil prices fell and investors turned their attention to a Bank of Canada interest rate decision this week.
The loonie was trading 0.1% lower at 1.3875 per U.S. dollar, or 72.07 U.S. cents, after touching its strongest intraday level since November 6, at 1.3829.
“It had a good run over the last little bit. The rally ran out of steam,” said Rahim Madhavji, president of KnightsbridgeFX.com.
“Everyone is looking towards the inflation report for Tuesday and then the Bank of Canada monetary policy decision on Wednesday.”
Canada's consumer price report for March, due on Tuesday, is expected to show inflation matching the 2.6% annual rate it posted in February.
Growing recession risks to Canada from the U.S.-led trade war will push the Bank of Canada to cut interest rates at least twice more this year, according to a Reuters poll, although a majority of the economists said policymakers will leave the benchmark rate unchanged at 2.75% on Wednesday.
Investors see a 55% chance of a pause in rate cuts, swaps market data shows.
The price of oil , one of Canada's major exports, was trading 0.6% lower at $61.15 a barrel on concerns that the trade war could weaken global economic growth despite exemptions for some electronics from U.S. tariffs.
Speculators have reduced their bearish bets on the Canadian dollar to the lowest since October, data from the U.S. Commodity Futures Trading Commission showed on Friday. As of April 8, net short positions had decreased to 119,241 contracts from 130,016 in the prior week.
Canadian bond yields moved lower across the curve as U.S. Treasury yields pulled back after an epic surge last week. The 10-year was down 13.6 basis points at 3.131%.
Reporting by Fergal Smith; Editing by Rod Nickel
