2 Min Read
* C$ at C$0.9951 to the U.S. dollar or $1.0049
* Bond prices weaker across the curve
* U.S. economy grows 3.2 percent in Q4
By Claire Sibonney
TORONTO, Jan 28 (Reuters) - Canada's currency was softer against the U.S. dollar on Friday morning with little in the way of domestic drivers and solid U.S. growth data providing broad-based support for the greenback.
The U.S. economy gathered speed in the fourth quarter, though a touch below expectations at 3.2 percent, but with the biggest gain in consumer spending in more than four years and strong exports offering the clearest signals yet that a sustainable recovery is under way. [ID:nN27219246]
"If you exclude inventories, real GDP grew by 7.1 percent, which is just a phenomenal rate and that was backed as well on the strengthen in consumer spending so that I think is a generally positive U.S. dollar story," said David Tulk, chief Canada macro strategist at TD Securities.
"The market will see through that headline and focus in on the more important element of demand which is consumer spending, so I think that will probably keep the Canadian dollar under pressure a little bit today."
At 9:10 a.m. (1410 GMT), the currency CAD=D4 was at C$0.9951 to its U.S. counterpart, or $1.0049, down from Thursday's North American finish at C$0.9932 to the U.S. dollar, or $1.0068.
For the day, Tulk said the Canadian dollar should still hold above parity against the U.S. dollar. He noted the support for the domestic currency around C$0.9975 and resistance in the C$0.9930 area.
Canadian bond prices were also weaker, mimicking moves in U.S. Treasuries. The two-year bond CA2YT=RR was down 2 Canadian cents to yield 1.733 percent, while the 10-year bond CA10YT=RR dropped 30 Canadian cents to yield 3.314 percent. (Reporting by Claire Sibonney; Editing by Theodore d'Afflisio)