CANADA FX DEBT-C$ firms on retail sales, crude prices

Tue Nov 25, 2014 10:07am EST
 
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* Canadian dollar at C$1.1247 or 88.91 U.S. cents
    * Bond prices mixed across the maturity curve

    By Solarina Ho
    TORONTO, Nov 25 (Reuters) - The Canadian dollar firmed
against the U.S. dollar on Tuesday, as Canadian retail sales
growth came in stronger than expected and U.S. oil prices rose
moderately.
    The currency's gains were initially capped as the U.S.
dollar firmed after data showed U.S. economic growth was far
stronger than initially thought in the third quarter.
 
     In Canada, a surge in the auto sector helped retail sales
power ahead by 0.8 percent in September, which could prompt
forecasters to boost their projections for gross domestic
product (GDP), due on Friday. 
    Statistics Canada has already reported strong manufacturing,
wholesale, export and building permits data for September, and
retail sales was the last key piece of economic data ahead of
Friday's GDP.
    At 9:45 a.m. (1445 GMT), the Canadian dollar was at
C$1.1247 to the greenback, or 88.91 U.S. cents, stronger than
Monday's close of C$1.1289, or 88.58 U.S. cents.
    U.S. crude was higher, while Brent crude was steady around
$80 a barrel ahead of an OPEC meeting this week that will decide
on production levels for next year. Oil prices have fallen by
nearly a third since June and are far below what many OPEC
members and rival producers need to balance their budgets.
    Martin Schwerdtfeger, a currency strategist at TD Securities
said the Canadian dollar, which was outperforming other major
currencies, was unlikely to make a big move ahead of other
events later in the week.
    The biggest drivers will be Thursday's OPEC meeting and
Friday's domestic GDP data for the third quarter and September.
    "Those are going to be the key events. But we have to keep
in mind that is going to be happening in an environment with
less liquidity because of the U.S. (Thanksgiving) holiday," said
Schwerdtfeger, noting that it will heighten the risk of more
volatility.
    Canadian government bond prices were mixed across the
maturity curve, with the two-year down 1 Canadian
cent, yielding 1.062 percent and the benchmark 10-year
 flat, yielding 1.981 percent.

 (Reporting by Solarina Ho; Editing by Jonathan Oatis)