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CANADA FX DEBT-Canadian dollar pares weekly decline as vaccine hopes rise

Credit: REUTERS/MARK BLINCH

The Canadian dollar edged higher against its U.S. counterpart on Friday, recouping some of this week's decline, as investors cheered prospects for a COVID-19 vaccine and domestic data showed factory shipments falling in line with expectations.

* Canadian dollar gains 0.1% against the greenback

* Canadian manufacturing sales fall by 2.0% in August

* U.S. crude prices were down 0.9% at $40.59 a barrel

* Canada's 10-year yield was nearly unchanged at 0.571%

TORONTO, Oct 16 (Reuters) - The Canadian dollar edged higher against its U.S. counterpart on Friday, recouping some of this week's decline, as investors cheered prospects for a COVID-19 vaccine and domestic data showed factory shipments falling in line with expectations.

U.S. stock index futures rose after Pfizer said it could apply for emergency use of its COVID-19 vaccine candidate as early as November, while data showed stronger-than-expected retail sales growth last month.

Canada is a major producer of commodities, including oil, so the loonie tends to be sensitive to prospects for global economic recovery.

U.S. crude prices were down 0.9% at $40.59 a barrel on concern that a spike in COVID-19 cases in Europe and the United States is curtailing demand in two of the world's biggest fuel consuming regions.

Canadian manufacturing sales fell by 2.0% in August, following three months of consecutive gains, Statistics Canada said. Excluding transportation equipment, sales rose 1.1%.

The Canadian dollar was trading 0.1% higher at 1.3206 to the greenback, or 75.72 U.S. cents, having traded in a range of 1.3191 to 1.3237. For the week, the loonie was on track to end 0.7% lower.

Preserving Canada's triple-A credit rating could be less of a priority for Ottawa than in years gone by, with the focus on digging the economy out of a hole rather than staying in a shrinking group of top-rated sovereign borrowers, analysts say.

Canadian government bond yields were mixed across the curve, with the 10-year nearly unchanged at 0.571%. (Reporting by Fergal Smith Editing by Nick Zieminski) ((fergal.smith@thomsonreuters.com; +1 647 480 7446;)) Keywords: CANADA FOREX/

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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