CANADA FX DEBT-C$ rises as risk appetite improves, crude oil rallies

Wed Jan 13, 2016 9:32am EST
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* Canadian dollar at C$1.4220 or 70.32 U.S. cents
    * Bond prices mixed across the maturity curve

    TORONTO, Jan 13 (Reuters) - The Canadian dollar rebounded
against a broadly firmer U.S. counterpart on Wednesday after
better-than-expected Chinese trade data helped support
risk-sensitive commodity currencies, while crude prices
rebounded from 12-year lows.
    The currency recovered after dropping on Tuesday below the
psychological 70 U.S. cents threshold for the first time since
May 2003 as speculation intensified that the Bank of Canada will
cut rates as early as next week.        
    Stock markets in Europe and Asia rose and oil prices jumped
after Chinese trade data cooled concerns over the world's
second-biggest economy, steadying money and currency markets in
Shanghai and Hong Kong. 
    U.S. crude prices were up 3.22 percent to $31.42 a
barrel. On Tuesday crude touched a low of $29.93, which was last
seen in December 2003.
    At 9:02 a.m. EST (1402 GMT), the Canadian dollar 
was trading at C$1.4220 to the greenback, or 70.32 U.S. cents,
stronger than the Bank of Canada's official close of C$1.4257,
or 70.14 U.S. cents.
    The currency's strongest level of the session was C$1.4188,
while its weakest level was C$1.4277. On Tuesday, it hit its
weakest since April 2003 at C$1.4316.    
    Canadian home prices fell 0.1 percent in December from a
month earlier, but were still up 6.2 percent from the year
before, the Teranet-National Bank Composite House Price Index
    Canadian government bond prices were mixed across the
maturity curve, with the two-year price down 0.5
Canadian cent to yield 0.339 percent and the benchmark 10-year
 rising 4 Canadian cents to yield 1.257 percent.
    The Canada-U.S. two-year bond spread was 1.1 basis points
more negative at -59.7 basis points, while the 10-year spread
was 2.8 basis points more negative at -86.6 basis points as
Canadian government bonds outperformed.
    The Bank of Canada will conduct on Wednesday a C$3.5 billion
5-year auction on behalf of the Government of Canada. The
bidding deadline is 12:00 p.m. EST (1700 GMT).

 (Reporting by Fergal Smith; Editing by Andrea Ricci)