CANADA FX DEBT-C$ rebounds as oil, equities climb

Tue Apr 21, 2009 12:38pm EDT
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* C$ rebounds at 80.87 U.S. cents

* Bank of Canada cuts rate 25 basis points to 0.25 pct

* Bond prices mostly higher across the curve (Updates to midday, adds quote)

By Jennifer Kwan

TORONTO, April 21 (Reuters) - A turnaround in equities and a rebound in the price of oil helped the Canadian dollar trim earlier losses against the greenback on Tuesday after the Bank of Canada surprised the market by cutting its benchmark interest rate to 0.25 percent.

The Toronto Stock Exchange's S&P/TSX composite index .GSPTSE shot up 1 percent at midday after starting the day in negative territory. U.S. stocks were also higher.

Oil pared early losses to trade above $46 a barrel. [ID:nSP465475]

"The oil prices have come off their bottom and stock markets have rebounded," said David Watt, senior currency strategist at RBC Capital Markets.

"People took yesterday's move as a chance to snap up some bargains again."   Continued...