The Canadian dollar steadied against its US counterpart on Friday as oil rose and investors took stock of sharp losses for the currency over the previous two days after the Federal Reserve raised interest rates. For the week, the loonie fell 1.2 percent. It slumped from its strongest level in eight weeks at C$1.3081 per US dollar before the Fed decision on Wednesday to hit its weakest in two weeks at C$1.3417 on Thursday.
US crude oil futures settled up $1 at $51.90 a barrel after Goldman Sachs boosted its price forecast for 2017 and producers showed signs of adhering to a global deal to reduce output. Oil is one of Canada's major exports. Investors who sold Canadian dollars have been "taking some chips off the table ahead of the weekend as liquidity conditions begin to dry up into the holidays," said Mazen Issa, senior foreign exchange strategist at TD Securities.
The Canadian dollar ended at C$1.3344 to the greenback, or 74.94 US cents, slightly stronger than Thursday's close of C$1.3347, or 74.92 US cents. The currency's strongest level of the session was C$1.3320, while its weakest was C$1.3392. Speculators raised bearish bets on the Canadian dollar to the most since March, according to Commodity Futures Trading Commission data and Reuters calculations. Net short Canadian dollar positions rose to 21,869 contracts as of December 13 from 18,158 a week earlier.
Canadian government bond prices were mixed across a steeper yield curve. The two-year rose 1 Canadian cent to yield 0.819 percent, while the 30-year fell 32 Canadian cents to yield 2.425 percent. The 30-year yield touched its highest intraday since November 2015 at 2.438 percent. Foreigners maintained their healthy appetite for Canadian securities in October, snapping up C$15.75 billion worth of bonds, stocks and money market paper, Statistics Canada said.