CANADA FX DEBT-C$ weakens after inflation slip, China rate cut
* Canadian dollar at C$1.3184, or 75.85 U.S. cents * Bond prices lower across the maturity curve By Alastair Sharp TORONTO, Oct 23 (Reuters) - The Canadian dollar weakened to a fresh three-week low against its U.S. counterpart on Friday after domestic inflation data slipped more than expected and China cut interest rates to spur growth in its slowing economy. Canada's annual inflation rate dipped to 1.0 percent in September on lower prices for gasoline, marking the 10th straight month it has been below the Bank of Canada's 2.0 percent target, Statistics Canada said on Friday. A Reuters poll of analysts had predicted the annual rate would be 1.1 percent in September, following August's 1.3 percent rate. "The softer number is going to put pricing pressure on the Canadian dollar," said Benjamin Reitzes, senior economist at BMO Capital Markets. Meanwhile, China's central bank cut rates for the sixth time since November and again lowered reserve requirements for its banks. * At 9:19 a.m. ET (1319 GMT), the Canadian dollar was trading at C$1.3184 to the greenback, or 75.85 U.S. cents, weaker than Thursday's close of C$1.3107, or 76.30 U.S. cents. * At one point it touched C$1.3190, its weakest since Oct. 2. It is on track for a 2 percent loss on the week. * U.S. crude prices were down 2.2 percent at $44.40 a barrel, while Brent crude lost 1 percent to $47.62. * The Canadian dollar was also weaker against most of its key currency counterparts, most sharply against its commodity-linked Australian counterpart. * Canadian government bond prices were lower across the maturity curve, with the two-year price down 3 Canadian cents to yield 0.537 percent and the benchmark 10-year falling 39 Canadian cents to yield 1.494 percent. * The Canada-U.S. two-year bond spread was -8.8 basis points, while the 10-year spread was -58.4 basis points. (Additional reporting by Susan Taylor; Editing by Bernadette Baum)
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