CANADA FX DEBT-C$ edges higher as hope for Greece rises

Fri Jun 17, 2011 5:05pm EDT
Email This Article |
Share This Article
  • Facebook
  • LinkedIn
  • Twitter
| Print This Article
[-] Text [+]

 * C$ rises to C$0.9802 to the U.S. dollar, or $1.0202
 * Down 0.2 percent on the week
 * Bond prices flat to lower
 * Risk sentiment rises on hints of Greece rescue plan
 (Adds details)
 TORONTO, June 17 (Reuters) - The Canadian dollar edged
higher against the greenback on Friday as news of an outline
agreement to aid debt-burdened Greece lifted investor
 But recent lackluster U.S. economic data, including
Friday's U.S. consumer confidence data, have weighed on the
Canadian dollar, whose health is heavily linked to the U.S.
economy because of the close trading relationship between the
two countries.
 "There was some relief in terms of the European situation,"
said Paul Ferley, assistant chief economist at Royal Bank of
Canada. "We did give back a bit of that with some of the
disappointment with the U.S. confidence weakening off."
 The currency CAD=D4 ended the day at C$0.9802 to the U.S.
dollar, or $1.0202, firming from Thursday's North American
finish of C$0.9832 to the U.S. dollar, or $1.0171. It finished
the week down 0.2 percent.
 During the day it rose as high as C$0.9776 to the U.S.
 "We're still really in a broad range here. Probably between
C$0.9700 and C$0.9900," said Shaun Osborne, chief currency
strategist at TD Securities. "I still think the underlying
trend is still a bit more towards Canadian dollar softness."
 He said that risk assets are not performing well and that
the Canadian dollar is a barometer for risk sentiment.
 "I think the tone of the U.S. numbers is still quite soft
and soft numbers in the U.S. typically translate into weaker
Canadian dollar performance overall," Osborne said.
 U.S. consumer sentiment worsened this month on renewed
concerns about the outlook for the economy, with gloom about
job and income prospects persisting. [ID:nN17179878]
 In Greece, Prime Minister George Papandreou appointed a new
finance minister in an effort to push through harsh economic
reforms after weeks of public protests. [ID:nLDE75G0CY]
 Meanwhile, the leaders of France and Germany said they had
an reached an outline agreement to save Greece from debt
default and avert another global crisis, but investor anxiety
looked likely to persist until a full accord is announced.
 Canadian bond prices were flat to lower across the curve,
as investors dipped their toes back into riskier assets. [US/]
 While Toronto's main stock market index lost ground and
closed at its lowest level in seven months, U.S. stock indexes
were mostly on higher ground.
 The two-year bond CA2YT=RR was down 1 Canadian cent to
yield 1.495 percent, while the 10-year bond CA10YT=RR slipped
15 Canadian cents to yield 2.946 percent.     
 (Reporting by Ka Yan Ng and Solarina Ho; editing by Peter