* Canadian dollar strengthens 0.3% against the greenback
* Canada's economy grows by 0.7% in January
* Loonie rises 1.1% since the start of the year
* Canadian bond yields rise across much of the curve
By Fergal Smith
TORONTO, March 31 (Reuters) - The Canadian dollar
strengthened against its U.S. counterpart on Wednesday and was
on track to advance for a fourth straight quarter as data showed
faster-than-expected growth in the domestic economy.
The Canadian economy grew by 0.7% in January, surpassing
estimates for 0.5%, largely on increases in wholesale trade and
manufacturing, Statistics Canada said. A flash estimate pointed
to a 0.5% gain in February.
"The growth outlook for this year continues to brighten amid
sizable fiscal stimulus, an ultra-accommodative central bank,
and good news on the vaccines," said Ryan Brecht, a senior
economist at Action Economics.
Pfizer Inc has agreed to accelerate the delivery of
its COVID-19 vaccine to Canada, and some doses of the Johnson &
Johnson inoculation are due to arrive at the end of April,
Canadian officials said on Tuesday.
The Canadian dollar was 0.3% higher at 1.2597 to the
greenback, or 79.38 U.S. cents, having recovered from its lowest
intraday level in nearly three weeks on Tuesday at 1.2646.
For the month, the loonie was on track to gain 1.1%, while
it was also up 1.1% since the start of the year, the strongest
performance among G10 currencies.
The U.S. dollar notched a one-year high versus the
yen and multi-month peaks with other currencies as investors bet
that fiscal stimulus and aggressive vaccinations will help the
United States lead a global pandemic recovery.
Canada sends about 75% of its exports to the United States,
including oil. U.S. crude prices were down 0.3% at $60.35
a barrel on concerns about the market's recovery after OPEC and
its allies lowered its 2021 demand growth forecast, although
strong Chinese factory activity lent some support.
Canadian government bond yields were higher across much of
the curve, with the 10-year up 1.2 basis points at
1.546%.
(Reporting by Fergal Smith;
Editing by Bernadette Baum)
Read More
