CANADA FX DEBT-C$ firms to best level in over a week in muted trading

Wed Jun 11, 2014 9:53am EDT
 
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* Canadian dollar at C$1.0871 or 91.99 U.S. cents
    * Bond prices rise across the maturity curve

    By Solarina Ho
    TORONTO, June 11 (Reuters) - The Canadian dollar
strengthened against the U.S. dollar to its firmest in over a
week Wednesday, helped in part by a low-volatility environment
and investor interest in commodity currencies, though moves were
limited with little economic data on tap.
    "I think it's just a byproduct of the very low volatility
environment that we seem to be in," said Adam Cole, global head
of FX strategy at RBC Capital Markets in London.
    "It's more (U.S.) dollar than Canada today. We are just
generally seeing the (U.S.) dollar under a bit of pressure,
particularly so against the other commodity currencies as much
as CAD." 
    At 9:20 a.m. (1320 GMT), the Canadian dollar was at
C$1.0871 versus the greenback, or 91.99 U.S. cents, stronger
than Tuesday's close of C$1.0904, or 91.71 U.S. cents.
    This was its strongest since June 2, when it touched
C$1.0838 during the session.
    Canada was also stronger against most other major
currencies. The Canadian dollar was approaching levels not seen
since January against the euro, which has been under pressure
due to a widening yield gap between euro zone bonds and their
major peers.
    RBC expects the currency to trade between C$1.0865 and
C$1.0905 during the session.
    Canadian government bond prices were higher across the
maturity curve, with the two-year up half a Canadian
cent to yield 1.078 percent and the benchmark 10-year
 rising 6 Canadian cents to yield 2.342 percent.

 (Reporting by Solarina Ho; Editing by Bernadette Baum)