CANADA FX DEBT-C$ hits 3-week high on improved sentiment
* C$ rises to C$1.1431 to the U.S. dollar
* Marks C$'s highest level since June 24
* Bond prices stuck lower across curve
By Frank Pingue
TORONTO, July 14 (Reuters) - Canada's dollar shot to its highest level in nearly three weeks versus the U.S. currency on Tuesday as a better outlook on corporate earnings and a rise in commodity prices opened the door to greater risk taking.
It was enough to boost the Canadian dollar to C$1.1431 to the U.S. dollar, or 87.48 U.S. cents, which marked its highest level since June 24. The domestic currency backed off slightly but still remained comfortably above Monday's close and well above the seven-week low it touched last week.
"One of the fears people had coming into this week was the earnings season ... but there was probably too much bearishness built into the market so now we're getting some relief rally at the present time," said David Watt, senior currency strategist at RBC Capital Markets.
"And people aren't moving in marginal increments. People are moving wholesale to either risk aversion or to risk seeking and right now we are in a risk seeking environment."
Bullish comments from prominent banking analyst Meredith Whitney on Monday lifted expectations that quarterly earnings from U.S. banks will be better than expected. [ID:nBNG121776]
At 7:50 a.m. (1150 GMT), the Canadian unit was at C$1.1440 to the U.S. dollar, or 87.41 U.S. cents, up from C$1.1518 to the U.S. dollar, or 86.82 U.S. cents, at Monday's close.
Also helping to support the Canadian dollar was a rise in prices for key Canadian exports like oil and gold. Oil prices reversed the previous session's fall and topped $61 a barrel, while gold prices inched higher to extend Monday's gain.
Domestic bond prices were lower across the curve alongside the bigger U.S. Treasury market as a rebound in equity markets overseas lessened the allure of more secure assets like government debt. (Editing by Theodore d'Afflisio)
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