CANADA FX DEBT-C$ hovers close to parity ahead of retail sales
* C$ ticks up to $1.0042
* Bond prices firm across curve
By Claire Sibonney
TORONTO, Jan 21 (Reuters) - The Canadian dollar was up slightly against its U.S. counterpart on Friday, holding above parity as firm global equity markets and commodity prices lent some support ahead of domestic retail sales data.
Oil, a key Canadian export, edged higher after renewed confidence the European debt crisis would be resolved knocked the U.S. dollar down against the euro and helped to spur buying across a range of commodities. [O/R]
Canadian retail sales figures for November were seen providing further direction. Analysts polled by Reuters called for a 0.5 percent increase. [ECON/CA]
"The area we want to focus on is real retail sales that strips out the impact of inflation, just because gas prices are a major part of that 0.5 percent nominal gain and here we need to be a little bit careful in thinking that this might pose a bit of a risk to Q4 growth," said David Tulk, chief Canada macro strategist at TD Securities.
"We're looking basically at growth around the 2.3 percent that the Bank of Canada expects but if there is a surprise to this number, it would be possibly be to the downside just in terms of the real inflation adjusted measure."
At 8:01 a.m. (1301 GMT), the Canadian dollar CAD=D4 stood at C$0.9958 to the U.S. dollar, or $1.0042, up slightly from Thursday's North American close at C$0.9971 to the U.S. dollar, or $1.0029.
The currency on Thursday fell for a third straight session against the greenback to its weakest levels in more than two weeks, weighed down by stronger-than-expected Chinese growth data as well as surprisingly dovish talk by the Bank of Canada earlier in the week.
"We've reoriented ourselves away from what was looking to be stronger than parity in a cohesive way to something that is basically bouncing around parity," added Tulk.
"We're kind of back to where we think the currency should be."
Canadian government bond prices edged higher, tracking U.S. Treasuries. The two-year bond CA2YT=RR was up 3 Canadian cents to yield 1.710 percent, while the 10-year bond CA10YT=RR gained 5 Canadian cents to yield 3.299 percent.
(Reporting by Claire Sibonney)
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