C$ posts second straight weekly gain on rising risk appetite
* Canadian dollar strengthens 0.3% against the greenback
* Touches its strongest since May 5 at 1.2729
* Price of U.S. oil rises 0.5%
* Canadian bond yields trade mixed across curve
By Fergal Smith
TORONTO, May 27 (Reuters) - The Canadian dollar rose to its highest level in more than three weeks against its U.S. counterpart on Friday, and posted its second straight weekly gain as recent volatility in global financial markets continued to subside.
The loonie CAD= traded 0.3% higher at 1.2730 to the greenback, or 78.55 U.S. cents, after touching its strongest since May 5 at 1.2729. For the week, the currency was up 0.8%.
"The risk mood is clearly a big driver of the CAD's performance but firm commodities and modestly supportive (interest rate) spreads are perhaps adding to CAD tailwinds," strategists at Scotiabank, including Shaun Osborne, said in a note.
U.S. stock market benchmark the S&P 500 index .SPX was set for its best weekly gain since mid-March as upbeat earnings, strength in consumer spending and signs of inflation peaking eased worries about a sharp slowdown in economic growth.
Oil CLc1 , one of Canada's major exports, was up 0.5% at $114.70 a barrel as signs of a tight market supported prices ahead of the U.S. Memorial Day holiday weekend, the unofficial start of the peak U.S. summer demand season.
Gains for the loonie came ahead of a Bank of Canada interest rate decision next Wednesday. The central bank is expected to hike by half a percentage point for a second straight meeting to tackle soaring inflation.
Canadian government bond yields were mixed across the curve. The 10-year CA10YT=RR was little changed at 2.793%, after touching a four-week low of 2.743% on Wednesday.
Reporting by Fergal Smith; editing by Jonathan Oatis and Richard Chang
Disclaimer: The XM Group entities provide execution-only service and access to our Online Trading Facility, permitting a person to view and/or use the content available on or via the website, is not intended to change or expand on this, nor does it change or expand on this. Such access and use are always subject to: (i) Terms and Conditions; (ii) Risk Warnings; and (iii) Full Disclaimer. Such content is therefore provided as no more than general information. Particularly, please be aware that the contents of our Online Trading Facility are neither a solicitation, nor an offer to enter any transactions on the financial markets. Trading on any financial market involves a significant level of risk to your capital.
All material published on our Online Trading Facility is intended for educational/informational purposes only, and does not contain – nor should it be considered as containing – financial, investment tax or trading advice and recommendations; or a record of our trading prices; or an offer of, or solicitation for, a transaction in any financial instruments; or unsolicited financial promotions to you.
Any third-party content, as well as content prepared by XM, such as: opinions, news, research, analyses, prices and other information or links to third-party sites contained on this website are provided on an “as-is” basis, as general market commentary, and do not constitute investment advice. To the extent that any content is construed as investment research, you must note and accept that the content was not intended to and has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such, it would be considered as marketing communication under the relevant laws and regulations. Please ensure that you have read and understood our Notification on Non-Independent Investment. Research and Risk Warning concerning the foregoing information, which can be accessed here.