CANADA FX DEBT-C$ firms up as equity markets climb

Tue Mar 10, 2009 7:50am EDT
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TORONTO, March 10 (Reuters) - The Canadian dollar strengthened against the U.S. dollar on Tuesday morning, helped in part by slightly higher oil prices and as global equity markets climbed after recent declines.

At 7:32 a.m. (1132 GMT), the Canadian currency was C$1.2922 to the U.S. dollar, or 77.39 U.S. cents, up from Monday's close at C$1.2991 to the U.S. dollar, or 76.98 U.S. cents.

"The tone this morning is for a weaker U.S. dollar," said Michael Gregory, senior economist at BMO Capital Markets.

"Stocks are all stronger this morning, bonds are weaker this morning so it looks like a general tone toward increased risk appetite, which favors the Canadian dollar."

At one point in the overnight session, the unit touched C$1.2860 to the U.S. dollar, or 77.76 U.S. cents.

Domestic bond prices were lower across the curve as U.S. stock index futures pointed to a higher open on Wall Street [ID:nLA324321], while world stocks rose after three days of consecutive declines. [ID:nLA118651]

Oil CLc1, a key Canadian export, inched up above $47 a barrel.

The rise comes after the Canadian unit fell to its lowest level versus the U.S. dollar since September 2004 on Monday as economic gloom prompted investors to sell riskier assets. (Reporting by Jennifer Kwan)