CANADA FX DEBT-C$ hits one-month low as risk aversion heats up
* C$ drops below 79 U.S. cents as equities tumble
* Canada's current account swings to deficit in Q4
* Bond prices rally as weak data sparks interest
By Frank Pingue
TORONTO, Feb 27 (Reuters) - Canada's dollar skidded to its lowest level in over a month on Friday given the combination of a drop in oil prices, safe-haven flows into the U.S. currency and data that showed Canada's current account swung into deficit.
Weak stock markets overseas and in North America coupled with the nagging concerns about the global banking system weighed on commodity-currencies like the Canadian dollar as investors flocked to the greenback given its safe-haven status.
"We saw risk aversion increasing quite significantly this morning and consequently commodity-based currencies are under more severe pressure," said Matthew Strauss, senior currency strategist at RBC Capital Markets. "And the U.S. dollar as a safe-haven benefited from this increase in risk aversion."
At 9:40 a.m. (1440 GMT), the Canadian unit was at C$1.2682 to the U.S. dollar, or 78.85 U.S. cents, down from C$1.2532 to the U.S. dollar, or 79.80 U.S. cents, at Thursday's close.
Earlier, the already weakening Canadian currency fell to its lowest level since Jan. 22 in the immediate aftermath of data that showed Canada's current account went into deficit for the first time in nearly a decade. Continued...