The Canadian dollar charged higher on Friday, buoyed by stronger oil prices and a weaker US currency, while bond prices were mostly lower ahead of next week's Bank of Canada interest rate decision.
The currency set a new 29-1/2 year high for the fifth time in the past six sessions, charging as high as C$1.0776, or 92.80 US cents, after a report on Friday showed US existing home sales fell 2.6 percent in April to their lowest level since June 2003.
The Canadian dollar finished at C$1.0794 to the US dollar, or 92.64 US cents, up from C$1.0847 to the US dollar, or 92.19 US cents, at Thursday's close. The currency started the session stronger, as US crude oil futures rose more than $1 a barrel, while gold prices also inched higher. Canada's currency often rises in line with the two commodities as the country exports both.
"The break came after the weak US existing US home sales data. That was really the trigger that got us over that 92.50 (US cents) level," said David Watt, senior currency strategist at RBC Capital Markets in Toronto.
Along with commodities, foreign investment and strong Canadian data have boosted the currency over the past two months as Canada's economic strength has shifted market expectations toward interest rate hikes later this year. The Bank of Canada makes its next rate decision on Tuesday.
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