Canadian dollar dips as oil prices fall, ends little changed for week

The Canadian dollar CADUSD weakened against its U.S. counterpart on Friday, giving back its weekly gain, as oil prices fell and the greenback gained ground against a basket of major currencies.

The loonie was trading 0.3% lower at 1.3380 to the greenback, or 74.74 U.S. cents, in a quiet session for North American financial markets after the U.S. Thanksgiving holiday.

The currency moved in a range of 1.3318 to 1.3398. For the week, it was nearly unchanged.

The U.S. dollar rose but remained near multi-month lows as investors weighed prospects of the Federal Reserve moderating the pace of its policy tightening.

The Bank of Canada has also been raising interest rates. Canadian third-quarter GDP data and the November employment report, due next week, could guide expectations for the pace of additional tightening.

The price of oil, one of Canada’s major exports, settled 2.1% lower at $76.28 a barrel, closing a week marked by worries about Chinese demand and haggling over a Western price cap on Russian oil.

Canadian government bond yields edged lower across the curve, tracking the move in U.S. Treasuries.

The 10-year was down nearly 1 basis point at 2.927% but held above the three-month low it touched intraday on Thursday at 2.907%.

Canada recorded a C$1.72 billion ($1.29 billion) budget surplus for the first six months of the 2022/23 fiscal year, helped by higher tax revenues, the finance ministry said.

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