CORRECTED - CANADA FX DEBT-C$ firms but stays in range before data

Thu Jan 27, 2011 5:20pm EST
 
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 (Corrects closing figures in first bullet point)
 * C$ closes at  C$0.9932 to the U.S. dollar, or $1.0068
 * Bond prices firmer across the curve
 * Market focus on upcoming U.S and Canadian GDP data
 (Adds details, comments)
 By Solarina Ho
 TORONTO, Jan 27 (Reuters) - The Canadian dollar firmed
against the greenback on Thursday, shrugging off weakness in
equities and softer resource prices, which would normally pull
the currency lower.
 Trading was light, however, and the Canadian dollar stayed
well within its recent C$0.99-to-parity range ahead of key
economic data on Friday and next week.
  "We're seeing some slight pickup in Canada buying,
particularly on the crosses, which is generating some flow with
respect to offers in USD/CAD," said Jack Spitz, managing
director of foreign exchange at National Bank Financial.
 "Look at Canada as more or less an oasis of stability
within a relatively volatile market around it ... The Canadian
dollar seems to be taking the global macro risks that are being
put on the table from time to time in good stride."
 Spitz noted that the currency has remained relatively
stable despite a downgrade of Japan's long-term debt rating on
Thursday, ongoing concerns over European financial stability,
and the U.S. Federal Reserve's decision to leave interest rates
near zero. [ID:nL3E7CR0Q5] [ID:nLDE70Q02C]
 The currency CAD=D4 finished the day at C$0.9932 to the
U.S. dollar, or $1.0068, up from Wednesday's North American
finish of C$0.9953, or $1.0047.
 The currency fell as low as C$0.9987, or $1.0013, in the
morning after data showed that new U.S. claims for jobless
benefits surged last week. [ID:nN27280337]
 "At this point, with not really much data out of Canada,
you can't really be surprised with this kind of range-bound
trading, especially with the U.S. numbers being mixed," said
Benjamin Reitzes, an economist at BMO Capital Markets.
 The United States will issue fourth-quarter gross domestic
product data on Friday and markets will look for clues to the
health of the world's biggest economy. Strength in the United
States would bode well for Canada, its biggest trading
partner.
 "Tomorrow's GDP numbers may mean a little bit more to the
Canadian dollar and the currency markets as a whole to see
where the U.S. economy is heading," Reitzes said.
  Next week a slew of Canadian data, starting with the
November GDP figures on Monday and culminating with January
jobs numbers on Friday, will provide more direction for the
currency.
 "It's not likely to trade between C$0.99 and parity for
much longer. The market will break it out. I think the
break-out is likely to be toward U.S. dollar weakness and
Canada strength," said Spitz, who sees the Canadian currency
rising to around the C$0.9837 level.
 Canadian bond prices were firmer across the curve.
 The two-year bond CA2YT=RR was up 2.5 Canadian cents to
yield 1.738 percent, while the 10-year bond CA10YT=RR climbed
29 Canadian cents to yield 3.278 percent.
 (Reporting by Solarina Ho; editing by Peter Galloway)