TORONTO, Aug 26 (Reuters) – The Canadian dollar strengthened to a five-month high against its U.S. counterpart on Monday as oil prices rose and major railroad operators focused on restoring service, after a work stoppage that threatened to disrupt the economy ended.
The loonie was trading 0.3% higher at 1.3470 to the U.S. dollar, or 74.24 U.S. cents, after touching its strongest intraday level since March 21 at 1.3464.
“The Canadian dollar continues to perform well in the aftermath of USD-CAD breaking and closing below strong support at 1.3590 on Friday,” said George Davis, chief technical strategist at RBC Capital Markets.
The oil rally has added to support for the currency, Davis said.
Speculators have cut their bearish bets on the Canadian dollar for a third straight week, data from the U.S. Commodity Futures Trading Commission showed on Friday. As of Aug. 20, net short positions had decreased to 164,410 contracts from 179,611 in the prior week.
Canadian government bond yields moved higher across the curve. The 10-year was up 2.1 basis points at 3.054% but staying within its recent range.
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Reporting by Fergal Smith; Editing by Paul Simao
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