CANADA FX DEBT-C$ hits 6-week high on rise in risk appetite, oil

Mon Mar 23, 2009 5:01pm EDT
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* C$ closes at six week high

* Risk appetite grows with US plan for toxic assets

* No direct currency impact from Suncor-Petrocan deal

* Bonds fall, focus on supply, stocks (Updates to close)

By Ka Yan Ng

TORONTO, March 23 (Reuters) - The Canadian dollar jumped to a six-week high against the U.S. dollar on Monday as risk appetite sharpened on news of a U.S. plan to help rid banks of toxic assets and the price of oil climbed.

The U.S. Treasury Department rolled out detailed plans to persuade private investors to help it take up as much as $1 trillion in bad assets now choking bank balance sheets. [ID:nnN23195140]

The news lifted optimism on global equity markets. Further support for the Canadian dollar came from oil prices, which rose more than 3 percent to near $54 a barrel on Monday. Canada is a big oil producer and explorer and the domestic currency's direction is often guided by the price of the commodity.

The currency finished at C$1.2225 to the U.S. dollar, or 81.80 U.S. cents, up from C$1.2395 to the U.S. dollar, or 80.68 U.S. cents, at Friday's close.   Continued...