CANADA FX - C$ pushes up ahead of rate announcement

Tue Jul 19, 2011 8:00am EDT
 
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* C$ rises to C$0.9548 vs US$, or $1.0473

* Bank of Canada rate announcement at 9 am

By Claire Sibonney

TORONTO, July 19 (Reuters) - The Canadian dollar edged up against the U.S. dollar on Tuesday morning as riskier assets rebounded from a recent selloff prompted by debt crises in Europe and the United States and as investors awaited an interest rate decision by the Bank of Canada.

While expectations are for no move at the 9 a.m. (1300 GMT) announcement, the tone of the central bank's statement will give the market an indication of its thinking ahead of its quarterly Monetary Policy Report on Wednesday.

"If we can see that they're going to be a little more hawkish here as far as when that rate hike is going to come I think that we could still see a little more of a boost in the Canadian dollar," said C.J. Gavsie, managing director of foreign exchange sales at BMO Capital Markets.

"The economic releases over the past month to two have been definitely leading up to this, but they've been very, very neutral ... and we're looking for them to become a little bit more aggressive in their comments."

At 7:42 a.m. (1142 GMT), the Canadian dollar was at C$0.9548 to the U.S. dollar, or $1.0473, up from Monday's North American session close at C$0.9589 to the U.S. dollar, or $1.0429.

Gavsie said immediate Canadian dollar resistance was seen near Friday's high of C$0.9520. Beyond there, he said investors will be looking to take profits in the C$0.9510-C$0.9500 level. (Reporting by Claire Sibonney; Editing by Theodore d'Afflisio)