Canada's loonie falls despite Trudeau's election call

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Canadian Dollar with the greenback Price of U.S. oil falls nearly 3% Canadian Factory Sales climb by 2.1% in June from May Canadian 10-year yield touches an 11 day low at 1.170% By Fergal Smith TORONTO, Aug 16 - The Canadian Dollar weakened against its U.S. counterpart on Monday as data showing slower economic growth in China weighed on sentiment overshadowing Canadian Prime Minister Justin Trudeau’s early election call. Trudeau held the election on 27 September, saying that his predictions for the post-pandemic economic rebound and the high vaccination rate against coronavirus will help him prolong and strengthen his grip on power. Canada's election bid should not have surprised the most casual of Canadian watchers as it has been highly anticipated for months, said Derek Holt, head of capital markets economics at Scotiabank in a memo. CAD is really ignoring it this morning, but could be prevented by the CAD statement. Global stocks slid after a raft of Chinese economic indicators showed a surprisingly sharp slowdown in the engine of global growth, just as much of the world races to stem the spread of the Delta variant of COVID - 19. Canada is a major producer of commodities, including oil, so the loonie tends to be sensitive to the global economic outlook. U.S. crude prices were down nearly 3% at $66.41 a barrel, while the Canadian Dollar was trading 0.3% lower to the greenback at 1.2554 or 79.66 U.S. cents. Speculators have cut their bullish bets on the Canadian Dollar, data from the U.S. Commodity Futures Trading CommissionU.S. Commodity Futures Trading Commission showed In the prior week, net long positions had dropped to 6,465 contracts from 7,460 in Aug. 10. Mixed domestic data for June was released. Wholesale trade jumped from May by 2.1% and factory sales fell by 0.8%. Data from the Canadian Real Estate Association showed home sales falling in July for the fourth straight month, down 3.5% from June. The Canadian 10-year yield reached its lowest for six months since August 5 at 1.170% before recovering slightly to 1.174%, down 1 basis point on the day.