CANADA FX DEBT-C$ tumbles from 8-week high after Fed rate hike
(Updates prices to close) * Canadian dollar settles at C$1.3274, or 75.34 U.S. cents * Loonie had touched strongest since Oct. 19 at C$1.3081 pre-Fed * Bond prices lower across a flatter yield curve By Fergal Smith TORONTO, Dec 14 (Reuters) - The Canadian dollar tumbled from an eight-week high against its U.S. counterpart on Wednesday, pressured by lower oil prices and broad gains for the greenback after the Federal Reserve raised U.S. interest rates for the first time in a year. The U.S. central bank raised rates by a quarter percentage point and signaled a faster pace of increases in 2017 as the Trump administration takes over with promises to boost growth through tax cuts, spending and deregulation. "The Fed was a little bit more hawkish than expected in the (policy path chart) and that is why we have seen the U.S. dollar higher pretty much across the board," said Greg Anderson, global head of foreign exchange strategy at BMO Capital Markets. Prices of oil, one of Canada's major exports, fell as the U.S. dollar gained following the Fed decision and after a jump in crude inventories at the biggest U.S. storage center renewed concerns about a glut. U.S. crude prices were down 4.02 percent at $50.85 a barrel. The Canadian dollar ended the day at C$1.3274 to the greenback, or 75.34 U.S. cents, much weaker than Tuesday's close of C$1.3133, or 76.14 U.S. cents. The currency's weakest level was C$1.3294, while it touched its strongest since Oct. 19 at C$1.3081. The loonie had gained steadily in recent weeks on the back of higher oil prices after major producers agreed to cut output. Canadian home prices rose in November from a month earlier as prices continued to soar in Toronto, the biggest market, helping to drive household debt to another record, separate reports showed on Wednesday. Canadian government bond prices moved lower across a flatter yield curve in sympathy with U.S. Treasuries. The two-year fell 5.5 Canadian cents to yield 0.807 percent and the benchmark 10-year declined 28 Canadian cents to yield 1.789 percent. On Tuesday, the 10-year yield touched its highest since June 2015 at 1.794 percent. (Reporting by Fergal Smith; Editing by Meredith Mazzilli and James Dalgleish)
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