Canada’s dollar rose versus most major peers on bets demand for oil will be buoyed by heightened tensions in the Middle East as U.S. President Barack Obama seeks support in Congress for a military strike on Syria.
Futures on crude oil, Canada’s largest export, gained as much as 1.2 percent on concern an attack on Syria will disrupt shipments from the Middle East. Bank of Canada policy makers will leave the benchmark overnight rate at 1 percent tomorrow, according to trading in overnight index swaps, which also show investors are pricing in 10 basis points of tightening for the bank’s June 2014 meeting, down from 16 points a month ago.
“The situation in Syria is going to take a lot longer than people thought, so commodity prices are likely to stay elevated a lot longer than people thought,” Greg Anderson, the head of global foreign-exchange strategy at Bank of Montreal in New York, said by phone. “Commodity currencies have become a lot more attractive.”
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