CANADA FX-C$ weighed by outside influences, bonds rise

Fri Nov 12, 2010 8:29am EST
 
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 * C$ falls to 98.96 U.S. cents
 * Bonds rise steadily as risk appetite hit by Ireland
 TORONTO, Nov 12 (Reuters) - Canada's currency fell against
the U.S. currency on Friday as risk appetite was bruised by
concerns about fiscal troubles in Ireland, while the Group of
20 leaders gathering in Seoul offered little assurances that
the world was any safer from economic catastrophe.
 In a communique signed off at the end of the G20 meeting,
there was a little something for everyone in a watered-down
commitment to watch out for dangerous imbalances but left the
details to be discusses in the first half of next year.
[ID:nN11196971] [ID:nN09105095]
 Meanwhile, choppy trading was intensified by market talk a
rescue package for Ireland was being negotiated, although this
was denied by an Irish finance ministry spokesman.
[ID:nWLA7895]
 Talk of another Chinese rate increase hit commodity prices
and equity markets as well, fuelling the Canadian dollar's
decline in early trade.    
 At 8:05 a.m. (1305 GMT), the Canadian dollar CAD=D4 was
at C$1.0105 to the U.S. dollar, or 98.96 U.S. cents, down from
C$1.0032 to the U.S. dollar, or 99.68 U.S. cents, at Thursday's
close.
 "We're now looking for more resolution of a lot of
different themes out there," said David Tulk, senior macro
strategist at TD Securities.
 "We're now back to looking at what's negative. I think that
speaks to an underlying lack of confidence in the state of the
global economy. So instead of focusing on the positive, we're
going from one negative to the next negative."
 There was no Canadian data on tap, leaving Canadian markets
to ride the ebb and flow of outside influences. Earlier the
Canadian dollar hit its lowest in more than a week at C$1.0146
to the U.S. dollar, or 98.56 U.S. cents, before paring losses.
 Canadian government bond prices were higher on Friday, as
investors found favor in the relative safety of this asset
class against declining equity markets.
 The two-year bond CA2YT=RR rose 9 Canadian cents to yield
1.535 percent, while the 10-year bond CA10YT=RR gained 12
Canadian cents to yield 2.964 percent.
 (Reporting by Ka Yan Ng; Editing by Theodore d'Afflisio)