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* Canadian dollar slips 0.4 percent versus greenback
* Bond prices rally with U.S. market on soft U.S. data
By John McCrank
TORONTO, Nov 26 (Reuters) - The Canadian dollar dipped 0.4 percent against the U.S. dollar on Wednesday on worries over slackening demand for Canadian commodities, but it closed well off its lows for the day as North American stock markets rebounded and commodity prices made gains.
Canadian bond prices rallied along with the larger U.S. market on weaker-than-expected U.S. data, which increased the allure of safe-haven government debt.
The Canadian dollar ended the North American session at C$1.2302 to the U.S. dollar, or 81.29 U.S. cents, down from C$1.2250 to the U.S. dollar, or 81.63 U.S. cents, at Tuesday's close.
At the beginning of the session, the currency weakened to C$1.2415 to the U.S. dollar, or 80.54 U.S. cents, as U.S. equity futures plunged on gloomy outlooks from several companies.
With global growth slowing, concern is growing that demand for the commodities Canada exports will drop off. In times of market volatility, such concerns are often reflected in the value of the Canadian dollar.
Stock prices started to rise during the session, as did prices for oil and some other key commodities, and the Canadian dollar followed suit.
"Slowly but surely, (the market) miraculously turned around and the world looks like a fairly safe place again for a change," said Steve Butler, director of foreign exchange trading at Scotia Capital.
The U.S. market is closed on Thursday for Thanksgiving Day, which could lead to more volatile moves by the Canadian dollar due to tighter liquidity.
Bond prices rallied along with the larger U.S. market on a raft of weaker than expected U.S. economic data, which sent investors looking for safe-haven government debt.
The U.S. economic data included another big drop in new home sales, another plunge in real consumer spending, a big pullback in durable goods orders, and jobless claims that remained elevated.
"Pretty bleak numbers all reaffirming that the U.S. economy is slipping into a deeper recession," said Sal Guatieri, senior economist at BMO Capital Markets.
There were no major Canadian data releases.
The two-year bond rose 9 Canadian cents to C$102.02 to yield 1.728 percent. The 10-year bond climbed 35 Canadian cents to C$107.25 to yield 3.352 percent.
The yield spread between the two-year and 10-year bond was 176 basis points, up from 171 at the previous close.
The 30-year bond jumped 80 Canadian cents to C$118.20 to yield 3.932 percent. In the United States, the 30-year Treasury yielded 3.932 percent. (Editing by Peter Galloway)