CANADA FX DEBT-C$ down as oil falls on demand concerns

Mon Dec 14, 2009 8:04am EST
 
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 * C$ down at 93.98 U.S. cents
 * Bond prices slightly higher along with U.S. Treasuries
 By Jennifer Kwan
 TORONTO, Dec 14 (Reuters) - The Canadian dollar fell on
Monday morning as the price of oil, a key export that often
influences the unit's price movements, dropped for a ninth
straight session on concerns over weak fuel demand.
 The unit touched an overnight session low of C$1.0661 to
the U.S. dollar, or 93.80 U.S. cents as oil dropped below $70 a
barrel. [O/R]
 "With oil dipping below $70 a barrel that dampened interest
in the oil-producing currencies," said Matthew Strauss, senior
currency strategist RBC Capital Markets
 The move lower came even as global equity markets showed
signs of strength after Abu Dhabi bailed out debt-stricken
fellow emirate Dubai. [MKTS/GLOB] Also, U.S. stock index
futures signaled a higher open. [.N]
 "It turned risk aversion into slight risk appetite but it
isn't as if it's a very significant return of risk appetite. It
was more of a blip of risk appetite. We still need to see if
that will carry through into the North American session," said
Strauss.
 The dollar index slipped, retreating from its highest in
more than a month hit last week, after Abu Dhabi agreed to bail
out its debt-laden neighbor with $10 billion in aid, easing
worries about a possible debt default by Dubai. [FRX/]
 David Bradley, director of foreign exchange trading at
Scotia Capital, added the Canadian currency weakness was also
likely due to a "general lack of interest as we head into the
holiday season."
 At 7:42 a.m. (1242 GMT), the Canadian dollar CAD=D3 was
at C$1.0640 to the U.S. dollar, or 93.98 U.S. cents, down from
Friday's finish of C$1.0599 to the U.S. dollar, or 94.35 U.S.
 Canadian bond prices were flat to higher across the curve,
tracking U.S. Treasuries upward on Monday on bargain hunting
after yields spiked last week. [US/]
 (Reporting by Jennifer Kwan, Editing by Chizu Nomiyama)