CANADA FX DEBT-C$ supported by oil, fundamentals

Wed May 12, 2010 8:29am EDT
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   * C$ at 98.43 U.S. cents
 * Bonds prices lower as stocks head higher
 TORONTO, May 12 (Reuters) - The Canadian dollar rose
against the U.S. dollar on Wednesday as a steadier oil price
helped support the commodity-linked currency, while the
country's strong fundamentals helped drive investor interest.
 The Canadian currency CAD=D4 touched a high of C$1.0154
to the U.S. dollar, or 98.48 U.S. cents as the North American
session got underway and added to the strength from the quiet
overnight session.
 At 8:10 a.m. (1205 GMT), the currency wasn't far off from
the high at C$1.0160 to the U.S. dollar, or 98.43 U.S. cents,
up from C$1.0218 to the U.S. dollar, or 97.87 U.S. cents, at
Tuesday's close.
 With the announcement of a massive emergency aid package in
Europe to stem the euro zone debt crisis, Canada's fiscal
position is relatively attractive to investors. A solid jobs
report last week highlighted Canada's recovering economy and
has fed positive sentiment toward the Canadian dollar.
 The price of oil held above $76 a barrel. [O/R]
 "(The) Canadian dollar is faring very well in all of this
and I expect that to continue," said John Curran, senior vice
president at CanadianForex, a commercial foreign exchange
dealing firm.
 "Everything is pointing to strong performance for Canada,
economically speaking."
 Canadian government bond prices were lower across the curve
as Europe debt worries eased, putting fixed income out of favor
with investors, who expected firmness in North American equity
 Overseas stocks strengthened on signs of continued German
growth and Spain's plans to cut its deficit.  [MKTS/GLOB]
 The two-year government bond CA2YT=RR fell 11 Canadian
cents to C$98.98 to yield 2.010 percent, while the 10-year bond
CA10YT=RR slipped 30 Canadian cents to C$99.00 to yield 3.620
 (Reporting by Ka Yan Ng; Editing by Theodore d'Afflisio)