CANADA FX DEBT-C$ weaker as commodities fall, USD firms
* C$ at C$1.0316 to US$, or 96.94 U.S. cents * Currency comes off one-month high * Bond prices lower By Cameron French TORONTO, July 24 (Reuters) - The Canadian dollar fell for the first time in a week on Wednesday, pulling back from a one-month high on the back of a stronger U.S. dollar, weaker commodity prices and falling Canadian stocks. Both gold and oil were down sharply, hurting the value of Canadian exports of both commodities, although that price move was largely a function of the rallying U.S. greenback. "It's a broad-based U.S. dollar strength story, and part of that is weaker oil and that definitely doesn't help the Canadian dollar," said Benjamin Reitzes, senior economist and foreign exchange strategist at BMO Capital Markets. Also pressuring the currency was a 0.7 percent drop in Canada's main stock index, as investors took a cautious view of riskier assets. The Canadian dollar finished its North American session at C$1.0316 to the U.S. dollar, or 96.94 U.S. cents, down from Tuesday's North American session close of C$1.0285, or 97.23 U.S. cents. The currency has been rising fairly steadily over the past two weeks and hit a one-month high of 97.45 U.S. cents early in the session, helped by strong sentiment from Tuesday's stellar Canadian retail sales data for May. On Wednesday, strong U.S. data had an impact, with the greenback boosted by a jump in U.S. new-home sales to a five-year high in June. BOND PRICES LOWER Longer-term Canadian government bond prices extended their recent slide, with the yield on the 30-year bond briefly rising above 3 percent on Wednesday for the first time since October 2011. The yield had hit a record low of 2.194 percent last July. The yields on 10- and 30-year Canadian government bonds sank to historic lows last year as investors, fearing the fallout of Europe's debt crisis, bought defensive assets. But bond yields have climbed in recent months as encouraging economic data increased expectations the U.S. Federal Reserve will begin winding down its bond-buying plan this year. The Bank of Canada is seen hiking interest rates next year. The two-year bond fell 6 Canadian cents to yield 1.148 percent, and the benchmark 10-year bond shed 56 Canadian cents to yield 2.476 percent.
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