CANADA FX DEBT-C$ firms on commodities, data in focus

Thu Jun 9, 2011 10:10am EDT
 
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  * C$ C$0.9773 to the U.S. dollar, or $1.0232
 * Bonds mostly weaker following U.S. jobs, trade data
 By Solarina Ho
 TORONTO, June 9 (Reuters) - The Canadian dollar was
modestly firmer against the U.S. dollar on Thursday morning as
oil prices held firm, with the currency moving in a tight range
ahead of Friday's Canadian employment data for May.
 U.S. crude climbed on supply worries after OPEC ministers
meeting in Vienna on Wednesday failed to agree on output
targets. The Canadian dollar is sensitive to oil-price swings
as oil is a key export. [O/R]
 "The firmness today is mainly coming from some of the
commodities, which have appreciated today," said Charles
St-Arnaud, Canadian economist and currency strategist in New
York at Nomura Securities International. "That's providing some
support for the Canadian dollar."
 At 9:12 a.m. (1312 GMT), the currency CAD=D4 was at
C$0.9773 to the U.S. dollar, or $1.0232, up from Wednesday's
North American finish of C$0.9797 to the U.S. dollar, or
$1.0207.
 Scotia Capital said in a morning note that it expected the
currency to trade between C$0.9743 and C$0.9815 through
Thursday.
 The Canadian dollar briefly fell close to Wednesday's
closing level after Canadian data showed the country's trade
deficit had widened unexpectedly to C$924 million in April
following a deficit of C$417 million in March, a downward
revision from a surplus. Much of the weakness came from supply
chain disruptions due to the Japanese earthquake and tsunami in
March. [ID:nN09150409]
 "We had relatively bad trade numbers, but a lot of it is
coming from revision from previous month, which was already
hinted in last week's GDP," St-Arnaud said, noting the
bounce-back in the currency after the market saw the data was
not as negative as it first appeared.
 South of the border, U.S. jobless claims rose unexpectedly,
stoking fears of a stalled economic recovery, even though a
separate report showed record U.S. exports in April. The United
States is Canada's biggest trading partner. [ID:nN09117731]
 After a string of lackluster North American economic data,
investors are looking ahead to Friday's Canadian jobs figures
for May for further guidance.
 Canadian bond prices were mostly weaker across the curve,
shadowing U.S. Treasuries, which pared gains following U.S.
jobless and trade data. [US/]
 The two-year bond CA2YT=RR was down 2 Canadian cents to
yield 1.439 percent, while the 10-year bond CA10YT=RR lost 19
Canadian cents to yield 3.028 percent.
 (Reporting by Solarina Ho; editing by Peter Galloway)