The Canadian dollar rose to its strongest in almost four weeks against its U.S. peer as the highest government-bond yields in more than a year bolstered demand from investors seeking greater returns.
Canada’s currency gained for a fifth day, the longest streak since April, as Canadian and U.S. government 10-year securities each yielded about 2.19 percent. Benchmark U.S. notes had yielded about nine basis points more at the end of May.
“If you have a higher-yielding currency, then you’ll have investors moving in -- so that places a bid into the Canadian currency,” Mazen Issa, Canada macro strategist at Toronto-Dominion Bank’s TD Securities, said by phone. “At the same time, the U.S. dollar has been hit over the past couple of weeks.”
The loonie, as the Canadian dollar is nicknamed, rose 0.3 percent to C$1.0157 per U.S. dollar at 8:28 a.m. in Toronto after touching C$1.0160, its highest since May 16. One loonie buys 98.44 U.S. cents.
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