TORONTO, April 11 (Reuters) – The Canadian dollar was little changed against its U.S. counterpart on Tuesday as investors awaited a Bank of Canada interest rate decision this week, with the currency steadying after it hit a 10-day low in the previous session.
World stocks rallied as traders held onto hopes that interest rates will soon peak and then fall later this year, even if the latest U.S. jobs data supported the case for another Federal Reserve rate hike next month.
The price of oil, one of Canada’s major exports, rose as speculation that the Fed might ease its policy tightening offset Chinese inflation data pointing to persistently weak demand. U.S. crude prices were up 0.8% at $80.35 a barrel.
The Bank of Canada has already paused its rate hike campaign. The Canadian central bank is expected to take in stride surprising recent economic strength and leave its benchmark rate unchanged at 4.50% at its policy announcement on Wednesday, betting that activity will cool as higher borrowing costs sink in.
The Canadian dollar was nearly unchanged at 1.3505 to the greenback, or 74.05 U.S. cents, after trading in a range of 1.3482 to 1.3516. On Monday, the currency touched its weakest intraday level since March 31 at 1.3553.
Canadian government bond yields were lower across the curve, with the 10-year down 1.7 basis points at 2.886%.
Reporting by Fergal Smith; Editing by Paul Simao
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