CANADA FX DEBT-C$ falls, pressured by slide in crude oil prices

Wed Dec 30, 2015 9:31am EST
 
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* Canadian dollar at C$1.3889 or 72.00 U.S. cents
    * Bond prices lower across the maturity curve

    TORONTO, Dec 30 (Reuters) - The Canadian dollar weakened
against its U.S. counterpart on Wednesday, tracking the drop in
crude oil prices, although maintaining its recent holding
pattern ahead of the New Year's Day holiday on Friday.
    Crude oil prices retreated as indications of slowing global
energy demand bumped up against record-high inventories.
 
    U.S. crude prices were down 2.01 percent to $37.11 a
barrel. Brent crude lost 1.59 percent to $37.19, moving
toward 11-year lows. 
    The slump in oil prices weighed on risk appetite
, providing an additional headwind for commodity
linked currencies.
    At 9:12 a.m. EST (1412 GMT), the Canadian dollar 
was trading at C$1.3889 to the greenback, or 72.00 U.S. cents,
weaker than Tuesday's close of C$1.3823, or 72.34 U.S. cents.
    The currency's strongest level of the session was C$1.3830,
while its weakest level was C$1.3916. It hit its weakest level
in more than 11-years on Dec. 18 at C$1.4003.
    Canadian government bond prices were lower across the
maturity curve, with the two-year price down 1
Canadian cent to yield 0.503 percent and the benchmark 10-year
 falling 12 Canadian cents to yield 1.420 percent.
    The curve steepened for as second straight day, as the
spread between the 2-year and 10-year yields widened 1.2 basis
points to 91.7 basis points, indicating underperformance for
longer-dated maturities.
    The Canada-U.S. 10-year spread was 1 basis point narrower at
-89.0 basis points, trimming recent outperformance for Canadian
government bonds, but trading near a record wide gap.
    The domestic data calendar remains bare. But further details
of next week's Government of Canada 2-year auction will be
announced.

 (Reporting by Fergal Smith; Editing by Chizu Nomiyama)