The Canadian dollar CADUSD edged lower against its U.S. counterpart on Thursday, pulling back from an earlier two-week high, as oil prices fell and preliminary domestic data showed wholesale trade falling in October.
The loonie was trading 0.1% lower at 1.3695 to the greenback, or 73.02 U.S. cents, after touching its strongest intraday level since Nov. 6 at 1.3651. Holidays in the U.S. and Japan kept currency market trading activity muted.
“The USD-CAD (currency pair) is still right in the middle of the recent range of 1.3650 to 1.3800,” Darren Richardson, chief operating officer at Richardson International Currency Exchange, said in a note. “A break and close either side of the range could provide direction in the pairing.”
The price of oil, one of Canada’s major exports, was down nearly 1% at $76.35 a barrel on expectations that OPEC+ might not deepen output cuts next year after the producer group postponed its policy meeting.
Canadian wholesale trade most likely fell 1.1% in October from September on lower sales in the machinery, equipment and supplies and the motor vehicle and motor vehicle parts subsectors, Statistics Canada said.
Retail sales data for October, due on Friday, could offer further clues about the strength of the domestic economy.
Canada’s economy is flirting with recession and the downturn could worsen now that a period of rapid growth in the United States is expected to end, raising bets on the Bank of Canada shifting to interest rate cuts as soon as April.
Canadian government bond yields rose across the curve. The 10-year was up 5.7 basis points at 3.711%, after touching its lowest level in more than two months at 3.588% during Wednesday’s session.