The Canadian dollar declined, trimming a gain last week that was the biggest since December 2011, as U.S. retail sales rose less than projected in June, underscoring a second-quarter slowdown in the economy of Canada’s largest trading partner.
The currency weakened for a second day as the yield advantage of U.S. 10-year notes compared with Canadian government debt was 12 basis points, approaching the 19-basis-point difference on July 5 that was the highest since 2011. The Bank of Canada will retain its 1 percent benchmark interest-rate target, according to a Bloomberg News survey before the announcement July 17.
“We’ve just kind of been holding ground since the data release this morning,” said Camilla Sutton, head of currency strategy at Bank of Nova Scotia in Toronto. “Almost every currency has stayed within a fairly narrow range.”
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