CANADA FX DEBT-C$ pressured by concerns about U.S. recovery

Fri Jul 16, 2010 8:28am EDT
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* C$ at 95.69 U.S. cents early on Friday

* Concerns over U.S. recovery hurting commodity currencies

* Bonds flat to slightly higher

By John McCrank

TORONTO, July 16 (Reuters) - Canada's dollar fell against its U.S. counterpart on Friday, as growing concerns about the strength of the U.S. economic recovery and the pace of growth in China dampened demand for commodity-based currencies.

Canada is a major exporter of commodities like oil, natural gas, copper, and gold, and about three-quarters of the country's exports are absorbed by the United States.

Recent U.S. economic data has come in weaker than market forecasters predicted and that has led to concern that the health of the world's No. 1 economy is a little weaker than recently thought.

"All of the commodity currencies have weakened off in the last 12 hours on general fears about a deterioration in the U.S. economic outlook," said Camilla Sutton, a currency strategist at Scotia Capital.

She said data out of China on Thursday also prompted concerns among market players that growth there, while strong, was not as robust as expected.   Continued...