By Commodity News Service Canada
WINNIPEG, Nov. 25 – The Canadian dollar strengthened relative to the US dollar on Tuesday, reacting to positive Canadian retail sales data, analysts said.
According to Statistics Canada, retail sales were up by 0.8 per cent in September, beating expectations of a 0.5 per cent rise.
The Canadian dollar closed at US$0.8887 or US$1=C$1.1253 on Tuesday, which compares with Monday’s North American settlement of US$0.8858 or US$1=C$1.1289.
A report from a major international organization calling for the Bank of Canada to increase interest rates by late 2015 was also bullish, brokers noted.
However, sharply weaker crude oil prices helped to limit the advances, as the Canadian dollar is a commodity-based currency.
Canadian bonds closed higher on Tuesday, as it followed the strength seen in the US bond market, according to participants.
The two-year bond yielded 1.047% late Tuesday, from 1.058% late Monday. The 10-year bond yielded 1.947%, from 1.979%. Bond yields fall as their prices rise.
