By Fergal Smith
TORONTO (Reuters) - The Canadian dollar edged lower against a broadly stronger U.S. counterpart on Friday but held near a three-year high and was up in April, a seasonally strong month for the currency, as domestic data supported a recent reduction of monetary stimulus.
The Canadian economy grew by 0.4% in February after lockdown measures were eased across parts of the country, Statistics Canada said. A flash estimate showed GDP jumping 0.9% in March.
"The recovery is in place and it is only going to get better," said Edward Moya, senior market analyst at OANDA in New York. "Many currency watchers are really applauding the Bank of Canada's decision (to reduce stimulus)."
Last week, Canada's central bank signaled that it could start hiking interest rates next year and cut the pace of its bond purchases.
The Canadian dollar edged 0.1% lower to 1.2288 to the greenback, or 81.38 U.S. cents. Earlier, it touched its strongest intraday level since February 2018 at 1.2266.
For the month, the loonie was up 2.2%. It has advanced in eight of the last 10 Aprils.
Speculators have raised their bullish bets on the Canadian dollar to the highest since February, data from the U.S. Commodity Futures Trading Commission showed. As of April 27, net long positions had increased to 15,722 contracts from 13,246 in the prior week.
The price of oil, one of Canada's major exports, was pressured by wider lockdowns in India and Brazil to curb the COVID-19 pandemic.
U.S. crude prices settled 2.2% lower at $63.58 a barrel, while the U.S. dollar was boosted by upbeat data on personal income, spending, and manufacturing.
Canadian government bond yields eased across the curve, with the 10-year down 1.3 basis points at 1.552%. On Thursday, it touched its highest intraday level in more than four weeks at 1.611%.
(Reporting by Fergal Smith; Editing by Mark Heinrich and Richard Chang)