TORONTO, Sept 2 (Reuters) – The Canadian dollar rebounded from nearly a three-week low against its U.S. counterpart on \u200bWednesday as investors raised bets on a Bank of Canada \u200cinterest rate hike in the coming months after the central bank said upside risks to inflation have increased.<\/p>\n
The loonie was trading 0.4% higher at 1.3840 per U.S. dollar, \u200bor 72.25 U.S. cents, after earlier touching its weakest level since \u200bAugust 13 at 1.3939.<\/p>\n
The Bank of Canada kept its key policy \u2060rate on hold at 2.25%, as widely expected, but Governor Tiff \u200bMacklem said policymakers were prepared to raise borrowing costs multiple times if inflation \u200bremained too high.<\/p>\n
“The BoC\u2019s emphasis on upside inflation risks from energy price pass-through caught the market off-guard,” Jason Daw and Simon Deeley, strategists at RBC Capital Markets, said in \u200ba note.<\/p>\n
“We view today\u2019s communications as moving them to a meeting-by-meeting \u200bbasis, meaning that all meetings are live.”
Investors see a 44% chance of a quarter-point rate \u200chike \u2060next month, up from 24% before the policy announcement, and have fully priced in a move by year-end.<\/p>\n
Canadian trade and employment data, due on Thursday and Friday, respectively, can offer further clues on the outlook for the \u200bdomestic economy.<\/p>\n
The price \u200bof oil, one of Canada’s \u2060major exports, rose on renewed military strikes between the U.S. and Iran that have restricted world oil supply. \u200bU.S. crude oil futures settled 0.9% higher at $91.01 a barrel.<\/p>\n
Canadian \u200bgovernment \u2060bond yields moved higher across the curve. The 2-year was up 9.6 basis points at 3.115%, its highest level since March 23.<\/p>\n
The gap between the 2-year yield \u2060and \u200bthe U.S. equivalent narrowed by 10.4 basis points \u200bto about 127 basis points in favor of the U.S. note, reversing some recent widening \u200bin the gap.<\/p>\n
Reporting by Fergal Smith; Editing by Paul Simao and Nick Zieminski<\/p>\n
Disclaimer:\u00a0The views expressed in this article are those of the author and may not reflect those of Kitco Metals Inc. The author has made every effort to ensure accuracy of information provided; however, neither Kitco Metals Inc. nor the author can guarantee such accuracy. This article is strictly for informational purposes only. It is not a solicitation to make any exchange in commodities, securities or other financial instruments. Kitco Metals Inc. and the author of this article do not accept culpability for losses and\/ or damages arising from the use of this publication.<\/p>\n","protected":false},"excerpt":{"rendered":"TORONTO, Sept 2 (Reuters) – The Canadian dollar rebounded from nearly a three-week low against its U.S. counterpart…\n","protected":false},"author":2,"featured_media":193774,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[2],"tags":[6244,6232,17,6237,6239,6231,6242,6235,6233,6236,381,1632,6243,6234,6223,6245,6228,6246,6230,6225,6226,6224,6227,113,6229,6241,6247,1633,6240,6238],"class_list":["post-193773","post","type-post","status-publish","format-standard","has-post-thumbnail","category-canada","tag-bank-forecasts","tag-bitcoin-news","tag-canada","tag-central-banks","tag-charts","tag-crypto-news","tag-currency","tag-economic-reports","tag-ethereum-news","tag-forecasts","tag-global-economy","tag-gold","tag-international-policy","tag-interviews","tag-kitco-news","tag-market-nugget","tag-metals","tag-mining-minutes","tag-mining-news","tag-palladium","tag-pgm","tag-platinum","tag-platinum-group-metals","tag-politics","tag-precious-metals","tag-rare-earth-metals","tag-roundups","tag-silver","tag-tech-metals","tag-us-dollar"],"_links":{"self":[{"href":"https:\/\/www.europesays.com\/canada\/wp-json\/wp\/v2\/posts\/193773","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.europesays.com\/canada\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.europesays.com\/canada\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/canada\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/canada\/wp-json\/wp\/v2\/comments?post=193773"}],"version-history":[{"count":0,"href":"https:\/\/www.europesays.com\/canada\/wp-json\/wp\/v2\/posts\/193773\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/canada\/wp-json\/wp\/v2\/media\/193774"}],"wp:attachment":[{"href":"https:\/\/www.europesays.com\/canada\/wp-json\/wp\/v2\/media?parent=193773"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.europesays.com\/canada\/wp-json\/wp\/v2\/categories?post=193773"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.europesays.com\/canada\/wp-json\/wp\/v2\/tags?post=193773"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}