CANADA FX DEBT-C$ firms modestly at the end of dismal 2014
* Canadian dollar at C$1.1607 or 86.15 U.S. cents * Bond prices higher across the maturity curve (Adds details, quotes, updates prices) By Leah Schnurr OTTAWA, Dec 30 (Reuters) - The Canadian dollar firmed against the greenback on Tuesday but the relief paled in comparison to the more than 8 percent loss the loonie has seen in 2014, putting it on track for its worst year since 2008. With just one more trading day left for the year, the Canadian dollar was expected to stick to a tight range in subdued holiday volume. Jitters over the future of Greece's bailout program as the country heads to an early election next month sapped investors' appetite for risk, sending the U.S. dollar lower to the benefit of the loonie. "Overall, the loonie is following the broader trend in the U.S. dollar," said Martin Schwerdtfeger, FX strategist at TD Securities in Toronto. "Even if the broader view is that the U.S. dollar-Canadian dollar should be going higher, at this point nobody is willing to extend U.S. dollar longs." The Canadian dollar ended the North American session at C$1.1607 to the greenback, or 86.15 U.S. cents, modestly stronger than Monday's close of C$1.1629, or 85.99 U.S. cents. Still, the Canadian dollar is down 8.5 percent this year, on pace for its worst performance in six years, when markets were gripped by the global credit crisis. Analysts expect the Canadian dollar will continue to lose ground in 2015, with the United States expected to lift interest rates before the Bank of Canada does. The weak price of oil, which is a major export for Canada, is also seen weighing on the currency. While the balance of risks suggest the Canadian dollar could work its way toward C$1.18 or C$1.20, a stabilization in oil prices would likewise stabilize the currency, said Amo Sahota, director at Klarity FX in San Francisco. "If oil prices actually stabilize, then I think U.S. dollar-Canadian dollar could have fairly quiet period for the first quarter of next year," Sahota said. "By quiet, I mean we could see it go back down toward C$1.12 and that really doesn't do much in the big scheme of how U.S. dollar-Canadian dollar has traded over the past 12 to 18 months." Canadian government bond prices were higher across the maturity curve, with the two-year up 3 Canadian cents to yield 1.018 percent and the benchmark 10-year up 16 Canadian cents to yield 1.815 percent. (Editing by Grant McCool)
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