CANADA FX DEBT-C$ firms against softer greenback in quiet year-end trading
* Canadian dollar at C$1.3508 or 74.03 U.S. cents * Bond prices mostly rise across the maturity curve TORONTO, Dec 29 (Reuters) - The Canadian dollar strengthened against its U.S. counterpart on Thursday, as the greenback slipped in tandem with U.S. Treasury yields in quiet holiday trading. The U.S. dollar extended its fall late in the previous session after data showed contracts to buy previously owned U.S. homes fell to their lowest level in nearly a year. The Canadian dollar ended Thursday's session at C$1.3508 to the greenback, or 74.03 U.S. cents, firmer than the Bank of Canada's official close of C$1.3555, or 73.77 U.S. cents. The currency's weakest level was C$1.3560, while its strongest level of the session was C$1.3482. "Late yesterday, after the U.S. treasury auctions, we saw the U.S. dollar weaken off across the board. Everything moved in tandem there," said Amo Sahota, director at Klarity FX in San Francisco. "The theme over last 24 or so has really been U.S. interest rates easing off a little bit ... But I wouldn't read anything too significant in any of these moves right now." Yields on most U.S. Treasuries hit at least two-week lows, halting the U.S. dollar's gains by reducing the appeal of higher-yielding U.S. assets compared to those of other countries. Canadian government bond prices were mostly higher across the maturity curve, with the two-year price up 3.5 Canadian cents to yield 0.76 percent and the benchmark 10-year rising 18 Canadian cents to yield 1.715 percent. The Canada-U.S. two-year bond spread was -45.8 basis points, while the 10-year spread was -76.2 basis points. (Reporting by Solarina Ho; Editing by Sandra Maler)
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