CANADA FX DEBT-Canada dollar firms as Fed remains in focus
* C$ at C$1.0462 vs US$, or 95.58 U.S. cents * Bond yields higher across the maturity curve By Leah Schnurr TORONTO, Nov 13 (Reuters) - The Canadian dollar strengthened against the greenback on Wednesday, rebounding from a two-month low as investors continued to try to gauge the future path of monetary policy for the U.S. Federal Reserve. The loonie has weakened by two cents in recent weeks after the Bank of Canada dropped its mild rate-hike bias and decent economic data out of the United States raised expectations the Fed will move to tighten its monetary policy. But on Tuesday, two senior Fed officials said the central bank should keep monetary policy ultra-easy, reinforcing views the Fed will not reduce the pace of its bond buying before next year. That pushed the U.S. currency down 0.3 percent against a basket of currencies on Wednesday, giving strength to the loonie. Still, the currency pairing is likely to head back to the mid-C$1.05 to C$1.06 levels in the weeks ahead, said Gareth Sylvester, director at Klarity FX in San Francisco. "In the next day or two, we're looking at a very neutral dollar-Canadian dollar market. From a weekly perspective, we're certainly bullish," said Sylvester. The Canadian dollar ended the North American session at C$1.0462 to the greenback, or 95.58 U.S. cents, stronger than Tuesday's close of C$1.0493, or 95.30 U.S. cents. The loonie had touched its lowest level since early September on Tuesday. Investors were also looking ahead to Thursday's Senate confirmation hearing at which Fed Chair nominee Janet Yellen is expected to speak. In remarks made available in advance of the hearing, Yellen said the Fed has "more work to do" to help an economy and labor market that are still underperforming. Domestically, Canadian trade balance data is on tap for Thursday, with the trade deficit expected to narrow slightly to C$1 billion in September from C$1.31 billion in August. The two-year bond was up 4 Canadian cents to yield 1.119 percent, while the benchmark 10-year bond rose 41 Canadian cents to yield 2.595 percent.
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