* Canadian dollar gains 0.3% against the greenback
* Touches its strongest since March 24 at 1.3727
* Factory sales rise 3.6% in February
* Canadian bond yields rise across the curve
TORONTO, April 15 (Reuters) – The Canadian dollar strengthened to a three-week high against its U.S. counterpart on Wednesday as the greenback continued to give back its recent safe-haven gains and domestic data showed increases for factory sales as well as for wholesale trade.
The loonie was trading 0.3% higher at 1.3727 per U.S. dollar, or 72.85 U.S. cents, marking its strongest intraday level since March 24. U.S. President Donald Trump said the war he launched with Israel on Iran was close to over, as the army chief of mediator Pakistan arrived in Tehran to try to prevent a renewal of the conflict.
“The U.S. dollar war premium has largely evaporated,” said Rahim Madhavji, president at KnightsbridgeFX.com. “There seems to be a deal imminent or to be had. That made for a risk-on trade.”
Wall Street stocks rose and the U.S. dollar weakened for an eighth straight day against a basket of major currencies. The price of oil, one of Canada’s major exports, settled one cent higher at $91.29 a barrel but was trading well below the peak levels it reached in recent weeks.
“Oil is elevated but it’s better than it was before so I think it’s a sign that global growth is not going to be impaired from the war situation. That (concern) has been a big overhang on the loonie over the last little bit,” Madhavji said. Canadian factory sales grew by 3.6% in February from January on higher sales of motor vehicles, as well as machinery. Separate data for February showed wholesale trade rising by 2%.
Canadian bond yields moved higher across the curve, tracking moves in U.S. Treasuries. The 10-year was up 4.8 basis points at 3.478%. (Reporting by Fergal Smith; Editing by Lisa Shumaker)
