CANADA FX DEBT-C$ hits 3-month low on oil, risk aversion

Mon Mar 2, 2009 4:41pm EST
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* C$ hit by lower crude, greenback strength

* Currency slides as low as 77.41 U.S. cents

* GDP data offers little help to C$

* Bonds bolstered by equity slump, flight to safety (Adds details)

By Ka Yan Ng

TORONTO, March 2 (Reuters) - The Canadian dollar hit a three-month low versus the U.S. dollar on Monday, spurred by renewed risk aversion and the declining price of crude oil.

Much of the day's action was an extension of the overnight session, where financial woes prompted a flight to the safety of U.S. dollar assets as American International Group posted a big loss amid U.S. government aid for the insurer.

"Most of the Canadian dollar weakness, in honesty, we'd seen before we'd walked in the door," said Shane Enright, currency strategist at CIBC World Markets in Toronto.

The currency closed at C$1.2914 to the U.S. dollar, or 77.44 U.S. cents, down from Friday's close of C$1.2723 to the U.S. dollar, or 78.60 U.S. cents. It hit a three-month low of C$1.2918 to the U.S. dollar, or 77.41 U.S. cents, late on Monday afternoon.   Continued...