CANADA FX DEBT-C$ pares losses in quiet trading as oil prices rally

Tue Jun 23, 2015 4:52pm EDT
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(Recasts throughout; adds comments, closing figures)
    * Canadian dollar ends at C$1.2333 or 81.08 U.S. cents
    * Bond prices mixed across the maturity curve

    By Solarina Ho
    TORONTO, June 23 (Reuters) - The Canadian dollar was steady
against the greenback on Tuesday as oil prices bounced higher,
after it recouped losses that had seen the currency slip to
two-week lows.
    Crude prices tracked a rebound in oil products such as
gasoline futures ahead of U.S. inventory data that is
forecast to show strong demand during the peak summer driving
    U.S. crude futures settled at $61.01 a barrel, up 63
cents, or 1 percent, while Brent crude futures settled
up $1.11, or 1.8 percent, at $64.45.
    With no Canadian economic data to drive moves this week, the
loonie's direction has been dictated by external forces.
    "It really didn't do much during the day today ...
Realistically, we have to get to a meatier set of data releases
before things will move with any real strength," said Mark
Chandler, head of Canadian fixed income and currency strategy at
RBC Capital Markets.
    The Canadian dollar finished at C$1.2333 to the
greenback, or 81.08 U.S. cents, barely weaker than the Bank of
Canada's official close of C$1.2326, or 81.13 U.S. cents, on
Monday. This, despite a U.S. dollar that was trading around
1-1/2-week highs against a basket of currencies. 
    The loonie, which traded between C$1.2309 and C$1.2383
during the session, was mostly stronger against its
    In the United States, second-tier data came in mixed, with a
report painting an encouraging picture about the housing market
but capital goods figures disappointing. 
    "Most people still have relatively upbeat - ourselves
included -  projections for Q2. They'll wait for confirmation
from the payroll reports, the next big piece of data coming from
the U.S.," said Chandler.
    Chandler said if a deal can be reached between Greece and
its creditors in the coming days to stave off a default, that
could also give the U.S. dollar a boost, and in turn weaken the
    Canadian government bond prices were mixed across the
maturity curve, with longer-term bond prices slipping. The
two-year price was down 1.5 Canadian cents to yield
0.631 percent and the benchmark 10-year fell 23
Canadian cents to yield 1.830 percent.
    The Canada-U.S. two-year bond spread was -5.1 basis points,
while the 10-year spread was -58.4 basis points.

 (Reporting by Solarina Ho; Editing by Peter Galloway and James