2013.07.1106:02:30UTC+00Canadian Dollar bolster for third day as Fed considers stimulus trims

Canadian Dollar bolster for third day as Fed considers stimulus trims

The Canadian dollar advance for a third day as Federal Reserve meeting minutes displayed divisions among policy makers about the timeframe for withdrawing financial stimulus known as quantitative easing.

Fed Message

“Once the information gets absorbed, the takeaway will be more hawkish and the market will reverse itself,” Jack Spitz, Toronto-based managing director of foreign exchange at National Bank of Canada, said in a phone interview following the release of the minutes.

Bonds Fall

Canada’s benchmark 10-year bonds dive down, pushing yields two basis points higher to 2.49 percent. The 1.5 percent security maturing in June 2023 declined 13 cents to C$91.39.

The Bank of Canada sold C$3.4 billion ($3.2 billion) of 1.25 percent notes maturing in September 2018.

The securities fetched an average yield of 1.884 percent and had a coverage ratio -- the amount bid relative to the amount sold -- of 2.5. The previous five-year auction on May 8 had a bid-to-cover ratio of 2.7, according to Bank of Canada’s website.

The Canadian dollar has improved 1 percent in the past three months versus nine developed nations currencies tracked by the Bloomberg Correlation Weighted Index, supported by the gains in the price of its largest export, oil. The U.S. dollar has acquired 5 percent.