CANADA’S FX DEBT – Canadian dollar nears 6-year high as inflation fears dissipate

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* The Canadian dollar strengthens 0.2% against the greenback * For the week, the loonie is on track to gain 0.6% * Canadian retail sales increase 3.6% in March * Price US Oil Price Rises 1.9% TORONTO, May 21 (Reuters) – The Canadian The dollar rose against its US counterpart on Friday as investor worries about US inflation faded and national data showed an increase retail sales in March, with the loonie approaching a six-year high reached earlier in the week. Canadian retail sales rose 3.6% in March from February, beating estimates of a 2.3% increase, according to Statistics Canada data. A quick estimate for April, when tighter restrictions to tackle the coronavirus pandemic were imposed by some provinces, showed sales down 5.1%. Global equity markets edged up after a volatile week, gaining the edge on stronger Wall Street as data on US trade activity eased inflation fears. The price of oil, one of Canada’s top exports, rose after three days of losses, but was on track for a weekly drop as investors braced for a resumption of Iranian crude supplies. U.S. crude prices rose 1.9% to $ 63.1 a barrel, while the Canadian dollar traded 0.2% higher at 1.2029 for the greenback, or 83.13 US cents . The loonie was on course to rise 0.6% for the week, which would be its eighth consecutive weekly advance. On Tuesday, it hit its highest level since May 2015 to 1,2013. The US dollar hit its lowest level in four months against a basket of major currencies as traders’ concerns over talks about tapping into the US Federal Reserve’s minutes faded. House prices in Canada will rise sharply in 2021, supported by ultra-low interest rates and robust demand driven by massive budget support, according to a survey of Reuters analysts. On Thursday, the Bank of Canada said the Canadian real estate market and high levels of household debt had made the economy more vulnerable to economic shocks. Canadian government bond yields were little changed, with the 10-year trading at 1.542% in a shortened session ahead of the Victoria Day holiday on Monday. (Reporting by Fergal Smith; editing by Jonathan Oatis)

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