CANADA FX DEBT-C$ near 4-week low as global growth outlook dims

Wed Oct 3, 2012 9:29am EDT
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* C$ at C$0.9883, or $1.0118
    * At weakest level since Sept. 6
    * Hurt by signs global economy faltering

    By Alastair Sharp
    TORONTO, Oct 3 (Reuters) - The Canadian dollar hit its
weakest level in nearly four weeks against its U.S. counterpart
on Wednesday, hurt by lower commodity prices and signs out of
China and Europe that the global economic slowdown may be
    The Canadian currency was also pulled lower by further signs
that Australia - another resource-reliant economy - was
suffering the ill-effects of lower demand.
    By 9:09 a.m. (1309 GMT) the Canadian dollar was at
C$0.9883, or $1.0118, its weakest level in almost a month. 
    "Some soft data out of Australia last night, and some weak
Chinese PMI data has pulled the commodity currencies lower,"
said Matt Perrier, director of foreign exchange sales at Bank of
    "Canada's been weakening off in a much more moderate ratio,
but trading in tandem with the Aussie overnight," Perrier said. 
    China's official purchasing managers' index for the services
sector fell to 53.7 in September from 56.3 in August as growth
in the manufacturing industry stabilized at a slower pace.
    Australia's trade deficit blew out to its widest in
three-and-a-half years in August as falling prices for iron ore
and coal ate into export earnings. 
    In Europe, dwindling new orders and faster layoffs marked a
worsening decline for euro zone companies last month, according
to business surveys that dent hopes the economy will return to
growth before 2013. 
    Still, a Reuters poll published on Wednesday showed Canada's
dollar is expected to strengthen in the coming year, boosted by
a hawkish Bank of Canada and the U.S. Federal Reserve's efforts
to bolster the recovery with fresh stimulus. 
    The Canadian currency is seen trading at C$0.98 to the
greenback, or $1.0204 one, three, six and 12 months from now,
according to the median forecast of 56 global foreign exchange