CANADA FX DEBT-C$ rises against weaker greenback, loses ground to safe-haven yen

Tue Feb 9, 2016 9:39am EST
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* Canadian dollar at C$1.3869 or 72.10 U.S. cents
    * Bond prices higher across the maturity curve
    * Canada 10-year yield hits record low at 1.008 percent

    TORONTO, Feb 9 (Reuters) - The Canadian dollar firmed
against a broadly weaker U.S. counterpart on Tuesday as oil
prices stabilized, although it extended losses against
safe-haven currencies on equities turmoil overseas.
    The U.S. dollar fell to its lowest in more than three months
against a basket of major currencies as financial
turbulence fed doubts about the Fed's ability to raise rates
this year. Testimony from U.S. Federal Reserve Chair Janet
Yellen is awaited on Wednesday. 
    Losses in Asian stock markets sent investors scurrying for
safe havens, while a drop in bank shares kept European shares
under pressure. Yields on longer-term Japanese
bonds fell below zero for the first time. 
    U.S. crude prices rose 0.07 percent to $29.71 a
barrel, but a report showing supply will not drop quickly enough
to erode a global surplus tempered gains. 
    At 9:15 a.m. EST (1415 GMT), the Canadian dollar 
was trading at C$1.3869 to the greenback, or 72.10 U.S. cents,
stronger than the Bank of Canada's official close of C$1.3934,
or 71.77 U.S. cents.
    The currency's strongest level of the session was C$1.3854,
while its weakest level was C$1.3959.
    Against the yen, the Canadian dollar touched its weakest
since Jan. 21 at 80.09 yen. 
    Canadian government bond prices were higher across the
maturity curve on the flight to safety.
    The two-year price rose 1 Canadian cent to yield
0.339 percent and the benchmark 10-year was up 15
Canadian cents to yield 1.035 percent. The 10-year yield hit a
new record low at 1.008 percent.
    The maturity curve flattened further as the long-end
outperformed. The spread between the 2-year and 10-year yields
narrowed by 1 basis point to 69.6 basis points, its tightest
since January 2015 when it touched 69.1 basis points.

 (Reporting by Fergal Smith Editing by W Simon)