CANADA FX DEBT-C$ edges up after IMF update, Aussie jobs data

Thu Jul 8, 2010 8:26am EDT
 
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 * C$ firms to 95.67 U.S. cents
 * Bonds mostly weaker across curve
 By Claire Sibonney
 TORONTO, July 8 (Reuters) -  The Canadian dollar edged
higher versus the greenback on Thursday after the International
Monetary Fund upgraded its 2010 global growth forecast and
strong Australian jobs data boosted higher-risk currencies.
 The IMF cited robust expansion in Asia and renewed U.S.
private demand, but warned the euro area's debt crisis posed a
big risk to recovery.
 Still, the fund raised its 2010 global output forecast to
4.6 percent from 4.2 percent in April's review of the global
economy. [ID:nTOE666034]
 "It's the ongoing gravitation towards risk-seeking trades,
that's the key driver," said Michael O'Neill, managing director
at Knightsbridge Foreign Exchange.
 "The whole investor mood, which is very fickle, is a little
more upbeat this week than it was last week."
  A jump in Australian employment in June drove the
Australian dollar, Canada's sister commodity currency, higher.
[FRX]
 World stocks, another proxy of risk appetite, gained on
rising expectations the forthcoming U.S. corporate earnings
season would show strong performance. [MKTS/GLOB]
 But U.S. stock index futures were little changed after the
previous day's surge as investors readied for data on jobless
claims and retail sales for clues about the direction of the
economy. [.N]
 At 8:07 a.m. (1207 GMT), the Canadian dollar CAD=D4 was
at C$1.0453 to the U.S. dollar, or 95.67 U.S. cents, up from
Wednesday's finish at C$1.0478 to the U.S. dollar, or 95.44
U.S. cents.
 O'Neill said the short-term Canadian technical levels were
bullish. He said the break below C$1.0475 will target C$1.0344
and then C$1.0250.
 Investors are also awaiting the European Central Bank's
comments on Thursday on bank stress tests and money markets.
[ID:nLDE6670DA]
 On the domestic front, the focus is on Friday's critical
employment report, which O'Neill said could lead to
position-squaring later in the day.
 With "risk-on" in play, Canadian government bond prices
were mostly lower across the curve.
 The two-year government bond CA2YT=RR lost 3 Canadian
cents to yield 1.653 percent, while the 10-year bond
CA10YT=RR was unchanged at a yield of 3.173 percent.
  (Reporting by Claire Sibonney, Editing by Chizu Nomiyama)