CANADA FX DEBT-C$ slides with oil, stocks
* C$ falls to 92.10 U.S. cents
* Oil prices, equities retreat
* Bonds mixed after latest U.S. data
* G20 meeting in focus
* Central banks cut back emergency lending facilities
TORONTO, Sept 24 (Reuters) - The Canadian dollar fell to its lowest level in more than a week against a broadly stronger U.S. currency on Thursday, hit by a drop in oil prices and equity markets, and as some central banks pared back emergency lending facilities.
Major central banks, including the U.S. Federal Reserve, announced they were scaling back some of their monetary stimulus measures [ID:nN24448204]. The move followed the Bank of Canada's announcement it would scrap two special lending facilities at the end of next month because of "improved conditions" [ID:nN22363926].
At 11:25 a.m. (1525 GMT), the Canadian currency was at C$1.0858 to the U.S. dollar, or 92.10 U.S. cents, down from C$1.0751 to the U.S. dollar, or 93.01 U.S. cents, at Wednesday's close.
"It's been a sharp and sudden move. The Canadian dollar is not the absolute laggard but it's right down there," said Eric Lascelles, chief economics and rates strategist at TD Securities.
"Certainly, liquidity operations are falling off but I don't see why Canada would be disproportionately affected in that."
While the Canadian dollar was hit, its decline was not as steep as sterling's, which extended losses against the euro and the U.S. dollar after Bank of England Governor Mervyn King told a British newspaper that a weaker pound was helping cushion the British economy's downturn. [ID:nN24445524]
The news came just ahead of the Group of 20 meeting on Thursday in Pittsburgh. Among major issues expected to be discussed will be the need to examine strategies for withdrawing economic stimulus measures as well as global imbalances. [ID:nLH78576]
Helping to accelerate the Canadian dollar's fall was a further drop in the price of oil to below $67 a barrel, while North American stocks turned lower after a mildly higher open. The Canadian dollar often tracks the direction of equity and resource prices as a reflection of risk appetite.
"It will really be a mix of reaction to equity markets, commodity markets. The markets will be very keen to understand what the G20 has got to say about global imbalances," said Jack Spitz, managing director of foreign exchange at National Bank Financial.
The Canadian dollar is expected by many analysts to be choppy but within a well-defined range until it can sustain a break beyond the high last week at C$1.0591 to the U.S. dollar, or weaken beyond C$1.11, the mid-July low.
BONDS NARROWLY MIXED
Canadian bond prices were mixed on Thursday, with short-dated issues lower and longer issues edging up as investors absorbed lower-than-expected U.S. weekly jobless claims and home sales data.
The two-year bond CA2YT=RR was off 3 Canadian cents at C$99.45 to yield 1.293 percent, while the 10-year bond CA10YT=RR fell 13 Canadian cents to C$102.62 to yield 3.429 percent. The 30-year bond CA30YT=RR gained 15 Canadian cents to C$118.15 to yield 3.919 percent.
Canadian bonds mostly underperformed their U.S. counterparts. (Reporting by Ka Yan Ng; editing by Rob Wilson)
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