Canada dollar weakens slightly ahead of data deluge

Thu Nov 1, 2012 8:05am EDT
 
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By Alastair Sharp

TORONTO (Reuters) - The Canadian dollar weakened against its U.S. counterpart on Thursday as signs of a shrinking domestic economy weighed, while traders looked ahead to a string of data for further direction.

At 7:45 a.m. (1145 GMT) the Canadian dollar was trading at C$1.0002 to the greenback, or $0.9998, compared with C$0.9990, or $1.0010, at Wednesday's North American close.

The currency felt some pressure after weak gross domestic product data pointed to slower growth in the third quarter.

"The moves overnight were fairly minor ... but for the day ahead there's a big focus on U.S. data," said Greg Moore, a foreign exchange strategist at TD Securities.

That U.S. data includes a private measure of employment and a government reading of unemployment claims, productivity and labor cost data, manufacturing and construction numbers and a delayed index of consumer confidence.

"However the bigger focus will still be on Friday's employment reports from both the U.S. and Canada. We usually see a quiet day ahead of that," Moore said.

Canada's commodity-linked currency seemed to brush off signs that China's economy perked up in October.

The price of government debt was flat to lower across the curve, with the two-year bond was off 1 Canadian cent to yield 1.077 percent, while the benchmark 10-year bond fell 10 Canadian cents to yield 1.794 percent.

(Reporting by Alastair Sharp; Editing by James Dalgleish)