CANADA FX DEBT-C$ rises, helped by higher oil prices

Tue Dec 15, 2015 10:05am EST
 
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* Canadian dollar at C$1.3715 or 79.21 U.S. cents
    * Bond prices lower across the maturity curve

    TORONTO, Dec 15 (Reuters) - The Canadian dollar edged higher
against the U.S. dollar on Tuesday, helped by higher crude oil
prices, while disappointing Canadian manufacturing data was
offset by firm housing data.    
    U.S. crude prices were up 1.57 percent to $36.88 a
barrel, while Brent crude added 1.58 percent to
$38.52. 
    Canadian factory sales fell 1.1 percent in October from
September, data from Statistics Canada showed. The median
estimate in a Reuters poll was for a 0.5 percent drop.
 
    At 9:49 a.m. EST (1449 GMT), the Canadian dollar 
was trading at C$1.3715 to the greenback, or 72.91 U.S. cents,
stronger than the Bank of Canada's official close of C$1.3738,
or 72.79 U.S. cents.
    The currency's strongest level of the session was C$1.3674,
while its weakest was C$1.3735.
    According to Reuters, a United Nations panel of experts says
in a confidential report that an Iranian missile launch in
October was a violation of a U.N. Security Council resolution.
Oil from Iran is expected to add to a global supply glut when
sanctions are lifted.
    Underlying U.S. inflation pressures rose in November, which
could give the Federal Reserve more ammunition to raise interest
rates on Wednesday. 
    Sales of existing homes in Canada rose 1.8 percent in
November from October, a report from the Canadian Real Estate
Association showed. 
    In other domestic data, commercial borrowing by small
businesses in Canada climbed in October, data from PayNet
showed. 
    Canadian government bond prices were lower across the
maturity curve in sympathy with U.S. Treasuries. The two-year
 price was down 2.5 Canadian cents to yield 0.52
percent and the benchmark 10-year fell 29 Canadian
cents to yield 1.504 percent.
    The Canada-U.S. 10-year spread was 1.9 basis points wider at
-77.2 basis points, as Treasuries underperformed.        
    Canada's weakening currency will probably face further
pressure from persistently low commodity prices that also
complicate the country's fiscal situation, the country's finance
minister said on Monday. 
    The Bank of Canada releases its Financial System Review
today, which deals with the main risks to financial stability.
Data on Monday revealed a rise in household debt compared to
income to a record 163.7 percent in the third quarter.
 On Friday, the government took steps to cool a
booming housing market. 

 (Reporting by Fergal Smith; Editing by James Dalgleish)