Canadian Dollar Rebounds from Two-Week Low Amid Month-End Hedging Flows

The Canadian dollar rebounded from its two-week low on Monday against the US dollar, thanks to month-end hedging flows and a rise in oil prices.

Noah Buffam, an FX strategist at CIBC Capital Markets, said that investors executed currency transactions around the end of the month to manage changes in their foreign exchange exposure due to portfolio movements.

The price of oil rose after a resumption of military action between the US and Iran rekindled market concerns about global supply disruption. US crude oil futures were trading 2.8% higher at $85.72 a barrel, which contributed to the Canadian dollar's rebound.

For the month, the loonie is on track to gain 1.2%, its second straight monthly advance, as recent domestic data showed economic growth accelerating.