CANADA FX DEBT-C$ weakens as greenback rises on Europe woes

Mon Dec 6, 2010 8:22am EST
 
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 * C$ ticks lower at 99.42 U.S. cents
 * Bond prices edge higher, follow U.S. Treasuries
 By Jennifer Kwan
 TORONTO, Dec 6 (Reuters) - The Canadian dollar edged lower
against the U.S. currency on Monday as the greenback rose on
persistent fears about euro zone debt concerns.
 Euro zone finance ministers meeting on Monday face IMF
pressure to increase the size of a 750-billion-euro safety net
for debt-stricken members to halt contagion in the single
currency bloc. For more see [ID:nLDE6B40EJ].
 "The U.S. dollar is fairly strong this morning so that's
got Canada weakened off a little bit," said Camilla Sutton,
chief currency strategist at Scotia Capital.
 "There's just ongoing fears in Europe," she added.
 At 8:00 a.m. (1300 GMT), the Canadian dollar was at
C$1.0058 to the U.S. dollar, or 99.42 U.S. cents, down from
Friday's finish at C$1.0033, or 99.67 U.S. cents.
 The euro slid on Monday with concerns about weaker European
economies undimmed. But shares were largely flat as euro zone
worries were offset by the possibility of more money being
injected into the U.S. economy.
 Federal Reserve Chairman Ben Bernanke said on Sunday the
U.S. central bank could end up buying more than the $600
billion in U.S. government bonds it has committed to purchase,
if the economy failed to respond. [ID:nN05271909]
 The price of oil CLc1, a key Canadian export, was largely
flat at around $89 a barrel, while gold and copper prices were
also little changed. [O/R] [GOL/] [MET/L]
 Canadian bond prices were firmer across the curve, tracking
U.S. Treasuries, where debt prices rallied after comments by
Bernanke that more bond purchases were possible.
 The two-year Canada bond CA2YT=RR was up 5 Canadian cents
at to yield 1.608 percent, while the 10-year bond CA10YT=RR
gained 28 Canadian cents to yield 3.156 percent.
 (Editing by James Dalgleish)