CANADA FX DEBT-C$ rallies as BoJ stokes risk appetite, oil prices rise

Fri Jan 29, 2016 10:01am EST
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* Canadian dollar at C$1.3974 or 71.56 U.S. cents

* Bond prices higher across the maturity curve

By Fergal Smith

TORONTO, Jan 29 (Reuters) - The Canadian dollar rose against a stronger U.S. counterpart on Friday after a Bank of Japan rate cut triggered gains for global asset markets, while oil rallied and data showed Canadian and U.S. growth in line with economists' expectations.

Canada's economy grew for the first time in three months in November, rising 0.3 percent.

The data supported a recovery in the Canadian dollar since the Bank of Canada surprised many traders last week and left its policy rate on hold at 0.50 percent.

"It probably puts quarterly GDP (gross domestic product) around zero, which is where the Bank of Canada was tracking," said Andrew Kelvin, senior rates strategist at TD Securities.

Supportive of the risk-sensitive Canadian dollar, world shares jumped after the Bank of Japan stunned markets with a surprise move to negative interest rates.

U.S. crude prices were up 3.3 percent to $34.30, heading for a weekly gain on hopes for a deal between major exporters to cut production.   Continued...