CANADA FX DEBT-C$ firms to 3-week high on inflation data, higher crude
* Canadian dollar hits C$1.1191, or 89.36 U.S. cents * Bond prices mostly lower across the maturity curve By Solarina Ho TORONTO, Nov 21 (Reuters) - The Canadian dollar powered to its highest level against the U.S. dollar in three weeks on Friday after Canadian inflation data came in stronger than forecast, making an interest-rate cut by the Bank of Canada highly unlikely. The currency got an early lift from higher crude prices, which rose on a rate cut in China and on speculation that OPEC could agree next week to reduce oil production. In Canada, the consumer price index rose 2.4 percent year-on-year in October, putting inflation at the highest level since June and surpassing economists' forecasts for a more modest increase of 2.1 percent. The CPI rise in September was 2.0 percent. "Clearly it removes any chance of the Bank of Canada cutting interest rates. Just on that basis, it warrants a higher Canadian dollar," said Sal Guatieri, senior economist at BMO Capital Markets. The Canadian dollar, which was outperforming nearly all major currencies against the U.S. dollar, touched a high of C$1.1191 to the greenback, or 89.36 U.S. cents, more than a cent stronger than Thursday's close of C$1.1306, or 88.45 U.S. cents, before paring some of the gains. At 9:26 a.m. (1426 GMT), it was trading at C$1.1234, or 89.02 U.S. cents. Canadian government bond prices were mostly lower across the maturity curve, with the two-year shedding 5 Canadian cents to yield 1.068 percent, and the benchmark 10-year off 9 Canadian cents to yield 2.029 percent. (Editing by Peter Galloway)
© Thomson Reuters 2016 All rights reserved.