CANADA FX DEBT-C$ little changed, eyes EU summit, data
* C$ flat at 99.55 U.S. cents
* Canadian bond prices tick up across curve
By Jennifer Kwan
TORONTO, Dec 16 (Reuters) - Canada's dollar traded flat on Thursday morning, largely in line with global equity markets, as investors took pause after coming within a tick of parity with the U.S. currency the day before.
European shares shed early gains and peripheral euro zone bonds dipped on Thursday after Spain paid a high premium at a debt auction, while U.S. stock index futures signaled a weaker open. [MKTS/GLOB] [.N]
Strategists said a key market focus on Thursday is expected to be a summit at which EU leaders will discuss the region's debt crisis. [ID:nLDE6BE29I]
For the most part, however, the Canadian currency took a breather after hitting C$1.0001 to the U.S. dollar, or 99.99 U.S. cents, on Wednesday, said Blake Jespersen, director, foreign exchange sales at BMO Capital Markets.
"It took a good run at parity, but just ran into too many sellers of the Canadian dollar," he said.
"The fact that it's still hanging very close to that level means I think we're going to eventually take it out. If not, then the next few days."
In the meantime, the market will likely draw direction from movements in equity and commodity markets, as well as U.S. data including housing starts, building permits and initial jobless claims. On tap in Canada is international securities transactions. [O/R] [MET/L] ECONUS
Much of the trade in coming sessions could also be flow-driven, said Jespersen.
"I think you're getting into some of the year end, call it, complacency," he said.
"There has been good liquidity, though. In terms of flow we've seen very good two-way flow from all kinds of different clients. The markets are active but just not volatile."
At 8:00 a.m. (1300 GMT), the Canadian dollar CAD=D4 stood at C$1.0045 to the U.S. dollar, or 99.55 U.S. cents, a hair lower from Wednesday's close at C$1.0040 to the U.S. dollar, or 99.60 U.S. cents.
Bonds were flat to slightly higher across the curve with the interest-rate sensitive two-year bond CA2YT=RR up 4 Canadian cents to yield 1.711 percent, while the 10-year bond CA10YT=RR climbed 18 Canadian cents to yield 3.306 percent. (Reporting by Jennifer Kwan, Editing by Chizu Nomiyama)
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