Canadian dollar rises against slumping greenback

Thu Sep 25, 2008 5:28pm EDT
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* Canadian dollar edges up 0.2 percent vs greenback

* Bailout plan hopes hit safe-haven bid for bonds

By John McCrank

TORONTO, Sept 25 (Reuters) - The Canadian dollar rose against a slumping U.S. dollar on Thursday as U.S. data missed expectations, compounding concerns about the economy as U.S. lawmakers tried to reach an agreement on a proposed bailout package for the battered financial sector.

Bond prices followed the larger U.S. market lower as stocks rallied on hopes that the $700 billion U.S. rescue plan would soon be passed by Congress, cutting into the recent safe-haven bid for government debt.

The Canadian currency ended the North American session up 0.2 percent at C$1.0343, or 96.68 U.S. cents, from C$1.0367, or 96.46 U.S. cents, at Wednesday's close.

The currency rose as high as C$1.0298, or 97.11 U.S. cents early in the session.

"I think for the most part a lot of that came from this morning when we had some weaker than expected U.S. data pretty much across the board," said George Davis, chief technical strategist at RBC Capital Markets.

While fallout from the U.S. housing and financial meltdown has weakened the greenback, the Canadian dollar has managed to gain more than 4 percent in the past two weeks as the Canadian economy has been less affected by the market turmoil.   Continued...