TORONTO, May 14 (Reuters) - The Canadian dollar on Thursday was on track for its longest daily losing streak since January against its U.S. counterpart as the gap widened between Canadian and U.S. bond yields.
The loonie was trading 0.1% lower at 1.3720 per U.S. dollar, or 72.89 U.S. cents, after touching its weakest intraday level since April 16 at 1.3737. It was the seventh-straight day of declines for the currency.
"USD-CAD’s push to a four‑week high is really a story of relative momentum," said Kevin Ford, FX & macro strategist at Convera.
"Hotter‑than‑expected U.S. inflation has kept the market leaning toward higher for longer (interest rates) in the U.S., while Canada has had little fresh macro this week to push back against last Friday’s softer labour print."
The U.S. dollar (.DXY), opens new tab added to recent gains against a basket of major currencies after economic data kept expectations intact that the Federal Reserve was unlikely to lower interest rates this year.
Canada's 2-year yield fell 2 basis points further below its U.S. equivalent to a gap of about 105 basis points in favor of the U.S. note, marking the widest spread since January 22. Investors tend to favor the higher-yielding currency.
Data on Friday showed that Canada's economy lost 17,700 jobs in April and the unemployment rate rose to a six-month high of 6.9%, indicating continued weakness in a labor market that has struggled in the face of trade uncertainty.
Trade uncertainty has also weighed on Canada's housing market. Home sales posted a modest increase of 0.7% in April from March after a slow start to the month, and prices edged lower, data from the Canadian Real Estate Association showed on Thursday.
The price of oil , one of Canada's major exports, was trading 0.6% higher at $101.65 a barrel.
Canadian bond yields moved lower across a flatter curve. The 10-year was down 4 basis points at 3.532%, trading around the middle of its range since the start of the month.
Reporting by Fergal Smith; Editing by Kirsten Donovan
