CANADA FX DEBT-Currency down for 5th straight session
* Canadian dollar now down 21 percent in 2008
* Bond prices end lower as riskier assets back in favor
* Friday's CPI data not expected to have big impact
By Frank Pingue
TORONTO, Oct 23 (Reuters) - The Canadian dollar closed slightly lower against the U.S. dollar on Thursday but managed to rally sharply from a 4-year low touched early in the session when investors opted to liquidate riskier assets in favor of the greenback.
Domestic bond prices were stripped of their early gains and closed lower right across the curve as volatile stock markets bounced back into positive territory and left investors with little interest for government debt.
The Canadian dollar closed at C$1.2557 to the U.S. dollar, or 79.64 U.S. cents, down from C$1.2547 to the U.S. dollar, or 79.70 U.S. cents, at Wednesday's close.
Earlier, the currency fell to C$1.2740 to the U.S. dollar, or 78.49 U.S. cents, its lowest level since October 2004. That slide was blamed on investors being forced to liquidate assets rather than the usual fundamentals.
The rebound by North American equity markets to close mostly higher, after spending much of the day in negative territory, helped reverse the slew of U.S. dollar buying that had been playing havoc with the domestic currency for days. Continued...