TORONTO, June 25 (Reuters) - The Canadian dollar was on track to snap its daily losing streak against the U.S. dollar on Thursday as oil prices rose and after U.S. inflation data led to the greenback giving back some of its recent broad-based gains.
The loonie was trading 0.2% higher at 1.4202 per U.S. dollar, or 70.41 U.S. cents. Its rise follows seven straight days of declines, including the currency touching a 14-month low of 1.4248 on Wednesday.
U.S. inflation increased in May, with the Personal Consumption Expenditures Price Index breaking above 4% for the first time in three years as the Iran war boosted energy prices.
"Overall price growth remains above target, but a slow-motion disinflation process should get under way in the coming months, giving the front end of the yield curve room to rally as the most aggressive tightening scenarios are priced out," said Karl Schamotta, chief market strategist at Corpay. He added that the U.S. dollar could be vulnerable to less hawkish commentary from members of the Federal Open Market Committee in the coming weeks.
The U.S. dollar (.DXY), opens new tab fell against a basket of major currencies after U.S. economic data slightly dented expectations for rate hikes from the Federal Reserve this year.
The U.S. price of oil , one of Canada's major exports, was trading 0.5% higher at $70.68 a barrel. Still, its pullback from peak levels during the U.S. war with Iran has eased some concerns about the global inflation outlook.
Statistics Canada data showed payroll employment rose by 22,000 jobs in April and that average weekly earnings accelerated to 3.8% year-over-year from 3.5% in March.
Canadian government bond yields were mixed across the curve. The 10-year was little changed at 3.360%, while the gap between it and the U.S. equivalent narrowed by 2.8 basis points to about 101 basis points in favor of the U.S. note.
Reporting by Fergal Smith Editing by Rod Nickel
