(Adds analyst quotes and details throughout; updates prices)
* Canadian dollar rises 0.1% against the greenback
* Canadian factory activity expands at a record pace in
March
* Price of U.S. oil settles 3.9% higher
* Canada's 10-year yield eases 4.7 basis points to 1.513%
By Fergal Smith
TORONTO, April 1 (Reuters) - The Canadian dollar edged
higher against its U.S. counterpart on Thursday, the start of a
seasonally strong month for the currency, as oil rose and
domestic data showed factory activity expanding at a record pace
in March.
The IHS Markit Canada Manufacturing Purchasing Managers'
index (PMI) rose to a seasonally adjusted 58.5 in March from
54.8 in February, posting the highest reading in the 10-year
history of the survey.
A measure of U.S. manufacturing activity for March was also
robust, soaring to its highest level in more than 37 years.
Canada sends about 75% of its exports to the United States,
including oil.
"The demand story for manufactured goods and raw materials
continues to heat up," said Adam Button, chief currency analyst
at ForexLive. "For an exporter like Canada, it bodes well for
many months ahead."
Separate data from Statistics Canada showed that the value
of building permits rose by 2.1% in February from a month
earlier, beating expectations of a 1.4% decline.
Analysts have raised their Canadian dollar forecasts for the
coming year, expecting the currency to benefit from faster
growth in the domestic economy and a potential reduction of Bank
of Canada bond purchases, a Reuters poll showed.
The Canadian dollar was trading 0.1% higher at 1.2547
to the greenback, or 79.70 U.S. cents. The currency has gained
ground in eight of the last 10 Aprils.
"The seasonal tailwind in the Canadian dollar is undeniable
in April and we may be seeing a reflection of that today,"
Button said.
U.S. crude oil futures settled 3.9% higher at $61.45
a barrel after news that OPEC+ reached a deal to gradually ease
production cuts from May.
Canada's 10-year yield eased 4.7 basis points to
1.513%, with the bond market closing early ahead of the Good
Friday holiday.
(Reporting by Fergal Smith; Editing by Kirsten Donovan; editing
by Grant McCool)
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