CANADA FX DEBT-C$ at six-month low on Canadian trade, U.S. jobs data
* Canadian dollar at C$1.1226 or 89.08 U.S. cents * Bond prices lower across the maturity curve By Leah Schnurr TORONTO, Oct 3 (Reuters) - The Canadian dollar weakened to a more than six-month low against the greenback on Friday as it was hit by a combination of disappointing domestic data and better-than-expected jobs growth south of the border. The declines pushed the loonie back through resistance at the C$1.12 level and put it within sight of reaching 2014's low so far at C$1.1279, which was seen in March. "It's a bit of a perfect storm for the currency," said Mazen Issa, senior Canada macro strategist at TD Securities in Toronto. Canada unexpectedly posted a trade deficit in August as exports dropped, while imports rose by the highest amount in almost two years. At the same time, U.S. job growth accelerated in September and the unemployment rate fell, giving the greenback a boost to the loonie's detriment. Canada will not release its jobs figures for September until next week. The Canadian dollar was at C$1.1226 to the greenback, or 89.08 U.S. cents, weaker than Thursday's close of C$1.1163, or 89.58 U.S. cents. The loonie touched a session low of C$1.1244, its lowest level since late March. The Canadian dollar is down 0.7 percent for the week so far, putting it on track for its second week of declines in a row. The Canadian trade figures imply economic growth for the third quarter that is now in the low 2 percent area, when it had been previously tracking at 2.5 percent, said Issa. "It's quite a dent in what expectations were for the quarter, but it certainly gives a lot of vindication for the Bank of Canada to have pounded the table, so to speak, on being cautious on the outlook," he said. Recent comments from Bank of Canada officials have reinforced the market's view of the bank's neutral-to-dovish policy stance. The central bank will release its next policy statement later in the month, along with updated economic forecasts. Canadian government bond prices were lower across the maturity curve, with the two-year down 1-1/2 Canadian cents to yield 1.128 percent and the benchmark 10-year down 16-1/2 Canadian cents to yield 2.106 percent. (Reporting by Leah Schnurr; Editing by Chizu Nomiyama)
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