CANADA FX DEBT-C$ ends weaker, stung by commodity price fall
* C$ closes at C$1.0580 per US$
* Fifth lower close in six sessions
* Bond prices end higher across curve (Recasts to close)
By Frank Pingue
TORONTO, Nov 24 (Reuters) - Canada's dollar fell versus the greenback on Tuesday, hurt by lower commodity prices, with upbeat overseas data and signs the U.S Federal Reserve is confident in a recovery providing some support.
A lack of risk appetite during the overnight session had dragged the domestic currency to as low as C$1.0645 to the U.S. dollar, or 93.94 U.S. cents, before it began a rebound.
Helping get the turnaround underway was a German business sentiment survey that came in better than expected, reaching its highest level since August 2008. [ID:nGEE5AN19N]
The currency also received a brief boost later in the day when minutes from the U.S. Federal Reserve's November meeting showed officials are confident the recovery is sustainable. [ID:nN24313828]
It briefly rose as high as C$1.0571 to the U.S. dollar, or 94.60 U.S. cents.
By the end of the session the Canadian dollar was not able to fully offset a drag from lower prices for oil and gold, two key Canadian exports whose prices often influence the currency. [GOL/] [O/R]
"All in all we had fairly mixed drivers of dollar/Canada on the day and so we are really closing the day almost where we closed yesterday." said Camilla Sutton, currency strategist Scotia Capital.
The Canadian dollar closed at C$1.0580 to the U.S. dollar, or 94.52 U.S. cents, down from C$1.0558 to the U.S. dollar, or 94.71 U.S. cents, at Monday's close. The currency has closed lower in five of the past six sessions.
Liquidity in financial markets is expected to dry up heading into Thursday's U.S. Thanksgiving Day holiday. Market players often book off on Friday for an extended weekend.
"Tomorrow could be interesting because there could be position squaring leading into the holiday," said Sutton. "But then once that is completed it should be pretty quiet the last two days of the week."
BOND PRICES GET BOOST
Domestic bond prices, with no major Canadian data to influence direction, followed the bigger U.S. Treasury market to a higher close. U.S. Treasuries rose after a strong auction of 5-year notes. [US/]
Appetite for more secure assets like government debt was also boosted by news the U.S. economy grew more slowly than first thought in the third quarter.[ID:nN24296971]
In issuance news, the province of Ontario will sell 1.75 billion euros of a new 10-year benchmark bond, according to IFR, a Thomson Reuters service.
The two-year bond CA2YT=RR ended up 13 Canadian cents at C$100.13 to yield 1.184 percent, while the 10-year bond CA10YT=RR rose 69 Canadian cents to C$103.77 to yield 3.285 percent.
Canadian bonds outperformed their U.S. counterparts across much of the curve. The Canadian 10-year bond was 2.90 basis point below its U.S. counterpart, compared with 1.50 basis points above on Monday. (Editing by Jeffrey Hodgson) ((email@example.com ; +1 416 941-8094; Reuters Messaging: firstname.lastname@example.org))
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