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Canadian Dollar Holds Near 8-Week High as Oil Prices Surge
The Canadian dollar held steady near an eight-week high against the U.S. dollar on Monday, supported by a sharp rise in crude oil prices and the lingering effects of strong domestic employment data.
Loonie Supported by Oil and Jobs Data
The loonie traded nearly unchanged at 1.3940 per U.S. dollar, or 71.74 U.S. cents, according to Investing.com data. The currency remained within a tight range during the session after touching 1.3923 on Friday, its strongest intraday level since June 10.
The currency's strength follows a report from last week showing that Canada's economy added more jobs than analysts had expected in July, providing a fundamental boost. This was compounded on Monday by a surge in the price of oil, one of Canada's most important exports. The U.S. benchmark crude price settled 5.05% higher at $82.13 a barrel.
AdTrade Tensions and Market Sentiment
The currency's resilience comes amid ongoing trade discussions between Ottawa and Washington. A source familiar with the talks on Friday indicated that Canada and the U.S. are negotiating a potential deal to avert new American tariffs in exchange for concessions from Canada.
This development is set against a backdrop of recently increased bearish sentiment. Prior to the tariff announcements, data showed that speculators had increased their short positions against the Canadian dollar to the highest level among major currencies, suggesting that the recent strength has defied some market expectations.
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