CANADA FX DEBT-Bernanke, data fail to lift C$ to parity
* C$ little changed at 99.45 U.S. cents
* Bonds prices mixed following Bernanke, data (Adds details, commentary)
By Claire Sibonney
TORONTO, Oct 15 (Reuters) - The Canadian dollar was little changed after briefly firming and almost reaching parity against its U.S. counterpart on Friday, following fresh signals that the U.S. monetary policy could ease further.
Federal Reserve Chairman Ben Bernanke said that high unemployment and low inflation point to a need for more stimulus, but he offered no details on the central bank's next step. [ID:nN15187998]
U.S. consumer price data for September, which came in weaker than expected, also highlighted the risk of a disinflationary environment, a key concern for the Fed.
"There was a lot of anticipation about today's data and speech but so far the U.S. dollar is slightly weaker than most currencies so it seems that the market is somewhat comfortable with that," said Camilla Sutton, chief currency strategist at Scotia Capital.
"I don't think we got any major surprises."
The currency firmed as high as C$1.0012 versus the U.S. dollar, or 99.88 U.S. cents, following Bernanke and the U.S. data before pulling back.
Also supportive for the Canadian dollar were Canadian factory sales, which jumped more than expected in August. [ID:nN15446129]
But Sutton stressed that the Canadian dollar is not currently trading on its fundamentals.
The Canadian dollar on Thursday briefly returned to a one-for-one level with the U.S. dollar for the first time since April as the greenback was pummeled to a 2010 low against a basket of major currencies.
"It's really not a CAD story like it was in the spring when we went to parity, this is very much a U.S. dollar weakness story," she said. "As soon as the U.S. dollar weakness story fades that will immediately fade the rally in CAD."
At 9:42 a.m. (1342 GMT), the Canadian dollar stood at C$1.0064 to the U.S. dollar, or 99.36 U.S. cents, little changed from Thursday's finish at C$1.0060 to the U.S. dollar, or 99.40 U.S. cents.
BONDS MIXED AFTER BERNANKE, DATA
Canadian government bond prices were mixed following Bernanke's speech and Canadian and U.S. data, with short-term issues firmer and longer-term bond prices weakening.
Canada's two-year bond CA2YT=RR was up 2 Canadian cents to yield 1.428 percent, while the 10-year bond CA10YT=RR shed 27 Canadian cents to yield 2.795 percent. (Editing by Jeffrey Hodgson)
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