CANADA FX DEBT-C$ steady in a quiet session as Fed, Keystone vote eyed

Tue Nov 18, 2014 4:34pm EST
 
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(Adds strategist's comment, details, closing figures)
    * Canadian dollar closes at C$1.1299, or 88.50 U.S. cents
    * Bond prices rise across the maturity curve

    By Solarina Ho
    TORONTO, Nov 18 (Reuters) - The Canadian dollar finished
little changed against its U.S. counterpart in quiet trading on
Tuesday as investors held off making bets ahead of Wednesday's
release of minutes from the latest U.S. Federal Reserve policy
meeting and with no major domestic economic data on tap until
week's end.
    A key U.S. Senate vote on Tuesday on approving the Keystone
XL oil pipeline project could move the commodities-linked
Canadian dollar, but any impact was not expected to be lasting.
The TransCanada Corp pipeline, if approved, would transport more
than 800,000 barrels per day of oil from the Alberta oil sands
to the U.S. Gulf Coast.
    Market participants will otherwise be looking at the details
of the October Fed meeting for hints on whether low inflation
could put next year's expected interest rate increase on hold.
    "The overarching theme is one of patience as we go into the
Federal Reserve's minutes tomorrow. That's going to stand out as
a key event, where we'll try to gauge the tone of the Fed," said
David Tulk, chief Canada macro strategist at TD Securities,
adding that the Fed's overall tone is likely to be more U.S.
dollar positive.
    The Canadian dollar finished the session at
C$1.1299 to the U.S. dollar, or 88.50 U.S. cents, steady with
Monday's close of C$1.1296, or 88.53 U.S. cents.
    "It's been quiet so far this week. Volatility's been lower,
volume's been lower. The Canadian dollar's taking the backseat a
little bit," said David Bradley, director of foreign exchange
trading at Scotiabank.
    "There's some cross activity going through as well ... which
has been keeping us trapped in a bit of a range also."
    There is no major Canadian economic data on tap until
Friday's consumer price index for October. Forecasters expect
inflation to rise to 2.1 percent from 2 percent, and core
inflation to remain steady at 2.1 percent. 
    Canadian government bond prices rose across the maturity
curve, with the two-year up half a Canadian cent to
yield 1.003 percent, and the benchmark 10-year 
climbing 24 Canadian cents to yield 1.997 percent.

 (Reporting by Solarina Ho; Editing by Peter Galloway)