September 26, 2019 / 9:08 PM / 2 months ago

CANADA FX DEBT-C$ retreats from 10-day high amid U.S. political uncertainty

 (Adds details on activity, updates prices)
    * Canadian dollar trades near flat against the greenback
    * Loonie touches an earlier 10-day high at 1.3232
    * Canadian July average weekly earnings rise 2.7%
year-over-year
    * Canadian bond prices climb across a flatter yield curve

    By Fergal Smith
    TORONTO, Sept 26 (Reuters) - The Canadian dollar was little
changed against its U.S. counterpart on Thursday, with the
currency pulling back from an earlier 10-day high as investors
weighed U.S. political uncertainty.
    Stocks fell, while safe-haven assets such as the U.S. dollar
       and Treasuries rose after a congressional panel released
a whistleblower complaint that accused President Donald Trump of
pressing a foreign government to investigate a potential rival
in next year's presidential election.             
    At 4 p.m. (2000 GMT), the Canadian dollar          was
trading nearly unchanged at 1.3273 to the greenback, or 75.34
U.S. cents.
    The loonie, which touched its strongest intraday level since
Sept. 16 at 1.3232, gained against all the other G10 currencies
except the New Zealand dollar       .        
    Relative strength for the loonie came as data from
Statistics Canada showed that Canadian average weekly earnings
rose by 2.7% year-over-year in July after a 2.1% gain in June
and that the number of non-farm payroll employees increased by
75,400.
    Stronger-than-expected wholesale trade and payrolls data
"should have forecasts for next week's monthly GDP release
moving up into positive territory and keeping Q3 tracking around
the 2% mark," Royce Mendes, a senior economist at CIBC Capital
Markets, said in a note.
    Data on Monday showed that Canadian wholesale trade
increased by 1.7% in July from June, surprising economists who
had forecast a 0.1% decrease.
    The U.S. House of Representatives is proceeding with efforts
regarding the Trump administration's trade deal with Mexico and
Canada, House Speaker Nancy Pelosi told reporters, saying
Democrats in the chamber had discussed the pact a day earlier.
            
    The price of oil, one of Canada's major exports, was largely
flat after a Pentagon statement intensified concerns of a Middle
East conflict disrupting supply. U.S. crude oil futures       
settled 0.1% lower at $56.41 a barrel.             
    Canadian government bond prices were higher across a flatter
yield curve in sympathy with U.S. Treasuries. The two-year
           rose 3.5 Canadian cents to yield 1.577% and the
10-year             was up 40 Canadian cents to yield 1.362%.
    On Wednesday, the 10-year yield hit its lowest intraday
level since Sept. 6 at 1.289%.

 (Reporting by Fergal Smith; Editing by Nick Zieminski and Peter
Cooney)
  
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