The Canadian dollar rose to a two-week high against its U.S. counterpart on Monday as investor sentiment remained positive ahead of this week's Federal Reserve decision.
The loonie rose 0.3% to 1.3411 to the greenback, or 74.57 US cents, its highest since Jan. 15.
“Spreads and equities have supported the CAD, and these factors will be important this week given the Fed's decision,” said Shaun Osborne, chief currency strategist at Scotiabank, in a note.
U.S. stocks rose ahead of this week's corporate earnings, economic data and Wednesday's announcement from the Federal Reserve, with the S&P 500 on track for another record high.
Canada is a major exporter of commodities, including oil, so the loonie benefits from signals from stocks about the global economic outlook.
U.S. crude futures were down 1.6% at $76.78 a barrel, giving up some recent gains on worries about demand from China's faltering real estate sector.
Canadian government bond yields also fell. The 10-year Canadian government bond fell 7 basis points to 3.452%, while the U.S. benchmark fell 2.8 basis points to 61 basis points. (Reporting by Fergal Smith, Editing by Deepa Babington)
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