CANADA FX DEBT-C$ slips off 8-week high on S&P Greek warning

Mon Jul 4, 2011 4:58pm EDT
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* C$ ends down at C$0.9608 vs US$, or $1.0408

* Bond prices slightly higher across curve (Updates to close, adds details, quotes)

By Claire Sibonney

TORONTO, July 4 (Reuters) - The Canadian dollar eased from a near eight-week high against the greenback on Monday in quiet holiday trading after Standard & Poor's warned that a debt rollover plan pushed by French banks could put Greece in danger of default.

Following that reminder that the euro zone's debt woes are far from over, the Canadian currency tracked weakness in the euro, though expectations for a second Greek bailout kept riskier assets, including equity markets, well bid. [FRX/] [nL3E7I40H3]

"That could have made people scale back a little bit but in a thin market like this, not a lot is going on," said John Curran, senior vice president at CanadianForex, noting volume was extremely light due to the Independence Day holiday in the United States, and following the Canadian dollar's big move higher last week.

"If anything, you may see some slight weakness on people just ringing the till on some of the recent positions that they've had, we had such a huge move last week."

On Saturday, euro zone finance ministers approved a 12 billion euro aid installment for Greece and said the details of a second aid package would be finalized by mid-September.

Anticipation of Saturday's deal helped the Canadian dollar rally more than 3 percent over the past week.   Continued...