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TORONTO, Feb 19 (Reuters) - Canada's dollar rose for a second straight session on Thursday, edging towards 80 U.S. cents, as risk appetite returned and the price of crude climbed.
At 8:40 a.m. (1340 GMT), the Canadian dollar was at C$1.2508 to the U.S. dollar, or 79.95 U.S. cents, up from C$1.2581 to the U.S. dollar, or 79.48 U.S. cents, at Wednesday's close.
Risk sentiment improved overnight, giving the Canadian dollar a lift to a session high of 80.21 U.S. cents, or C$1.2467 per U.S. dollar.
"What's driving Canada right now is overall weakness seen in the U.S. dollar, but more importantly...an unwind of Japanese yen longs," said Jack Spitz, managing director of foreign exchange at National Bank of Canada.
The yen remained under pressure due to worries about the Japanese economy and political uncertainty. Meanwhile, world stocks rallied on some better-than-expected corporate results, helping to cool extreme risk aversion and denting the safe-haven bid to the U.S. dollar. [FRX/]
The Canadian dollar also drew some support from oil prices that headed towards $36 a barrel ahead of U.S. inventory data and as the U.S. dollar weakened. Canada is a key oil producer and its currency is often influenced by price swings in the commodity.
Canadian data still due this week are the closely watched consumer price index report for January due on Friday. (Reporting by Ka Yan Ng; Editing by Jeffrey Hodgson)