4 Min Read
* C$ ends at C$1.0150 vs US$, or 98.52 U.S. cents
* Markets see-saw amid Europe uncertainty
* Bonds mixed (Updates to close, adds comment)
By Andrea Hopkins
TORONTO, Oct 20 (Reuters) - The Canadian dollar ended slightly stronger against its U.S. counterpart on Thursday as markets ping-ponged in a wait-and-see mode before a weekend policymaker meeting on Europe's debt crisis.
The euro edged lower and oil prices rose in volatile trade after France and Germany attempted to ease investor uncertainty by saying Sunday's summit to address the crisis would go on and a second meeting would be held no later than Wednesday.
Concerns about the crisis were offset by data showing an unexpected rebound in factory activity in the U.S. mid-Atlantic region in October, buoying hopes for economic recovery by Canada's largest trading partner. [MKTS/GLOB]
"The Canadian dollar was an outperformer, up 0.6 percent on the day while most of the other currencies are pretty flat," said Camilla Sutton, chief currency strategist at Scotia Capital.
"But I think most currencies are kind of in a holding pattern waiting for developments on the weekend, which now may be pushed out to next week."
The Canadian dollar CAD=D3 ended the North American session at C$1.0150 to the U.S. dollar, or 98.52 U.S. cents, up slightly from Wednesday's North American session close at C$1.0202 to the U.S. dollar, or 98.02 U.S. cents.
A German media report that Germany had not ruled out postponing Sunday's summit poured more cold water on optimism over the weekend meeting of EU leaders in Brussels.
The news out of Europe kept investors on their toes. Worries that the region's debt problems could cause another global recession have been at the forefront for months.
While European worries continue to dominate markets, Sutton said Canadian inflation data due out at 7 a.m. (1100 GMT) on Friday could influence Bank of Canada policy tone and the currency if the data comes in outside of expectations.
If the forecasts are correct, headline inflation will remain above the Bank of Canada's target range of 1 percent to 3 percent. Core inflation, which excludes volatile items like gasoline and some food, is right near the center of the band. ECONCA
An unexpected jump in the rate could support the Canadian dollar and hurt bonds.
Lower-than-expected inflation could prompt some to see a rate cut as a more serious option for the central bank's next move, dampening the value of the currency. [ID:nN1E79D19E]
In economic news, Canadian wholesale trade grew by a less-than-expected 0.2 percent in August from July, pushed higher by the machinery, equipment and supplies sector, Statistics Canada data indicated on Thursday. Analysts had expected an increase of 0.5 percent. [ID:nN1E79J0B3]
U.S. data showed factory activity in the U.S. Mid-Atlantic region rebounded in October and the number of Americans claiming new jobless benefits fell last week, fresh signs that the economy was likely to duck a new recession. [ID:nN1E79J0BQ]
Canadian bond prices ended mixed. The two-year Canadian government bond CA2YT=RR was down 1 Canadian cent to yield 1.042 percent, while the 10-year bond CA10YT=RR was up 15 Canadian cents to yield 2.321 percent. (Editing by Jeffrey Hodgson)