Gold firms as U.S.-China trade uncertainty persists
(Adds name of strategist's bank)
* Loonie touches its strongest level since Nov. 6 at 1.3158
* Canada's trade deficit narrows to C$1.1 billion in October
* Price of U.S. oil increases by 0.9%
* Canadian bond prices fall across a steeper yield curve
By Fergal Smith
TORONTO, Dec 5 (Reuters) - The Canadian dollar strengthened
on Thursday to its highest in nearly a month against the
greenback as data showed Canada's trade deficit narrowed and a
Bank of Canada official expressed confidence in the economic
outlook.
Bank of Canada Deputy Governor Timothy Lane said recent data
supported the central bank's forecast that the economy's
slowdown in the third quarter will be temporary. [nL1N28E20K]
On Wednesday, the central bank held its overnight interest
rate at 1.75% as expected and cited early signs the global
economy was stabilizing. [nL1N28D1SW]
"Right now they (the Bank of Canada) seem to be okay with
where the economy is," said Bipan Rai, North America Head, FX
Strategy at CIBC Capital Markets. "It implies that the market
shouldn't be pricing in a rate cut in January too aggressively."
Chances of an interest rate cut in January have fallen to
less than 10% from 20% before Wednesday's rate decision, data
from the overnight index swaps market showed.
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