CANADA FX DEBT-Canadian dollar firms on Greece optimism

Mon Mar 29, 2010 4:55pm EDT
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 * C$ rises to 97.97 U.S. cents
 * U.S. dollar broadly weaker as concern about Greece eases
 * Bonds ease as safety bid dwindles
 (Adds details)
 TORONTO, March 29 (Reuters) - The Canadian dollar firmed
against the U.S. dollar on Monday as concerns about debt
problems in the euro zone eased, undercutting the greenback's
safe-haven luster and helping to boost investor demand for
commodity-linked currencies.
 Strength in world equities and in the euro came as euro
zone leaders last week moved to create a safety net for
debt-hit Greece, seeking to persuade markets that the country's
bonds and those of other peripheral euro zone economies would
not default. [MKTS/GLOB]  [FRX/]
 "We're watching the euro as one of the drivers for
currencies," said Jack Spitz, managing director of foreign
exchange at National Bank Financial.
 The Canadian dollar ended at C$1.0207 to the U.S. dollar,
or 97.97 U.S. cents, up from Friday's finish of C$1.0267 to the
U.S. dollar, or 97.40 U.S. cents.
 It rose as high as C$1.0176 to the U.S. dollar, or 98.27
U.S. cents, before paring gains made in part on the rising
price of oil, an important Canadian export whose direction
often helps guide the movements of the Canadian dollar.
 Analysts say domestic factors that have highlighted the
Canadian economy's recovery continue to be beneficial for the
Canadian dollar, but external factors have kept the currency
off the near-parity levels it visited less than two weeks ago.
 The next major Canadian data will come Wednesday, when
seasonally adjusted gross domestic product figures for January
will be released. ECONCA
 With global equity markets on the rise and the safety bid
reduced in the wake of optimism for Greece, Canadian bond
prices were mostly softer.
 The two-year government bond CA2YT=RR was off 3 Canadian
cents at C$99.60 to yield 1.712 percent, while the 10-year bond
CA10YT=RR fell 7 Canadian cents to C$101.40 to yield 3.570
 Canadian bonds mostly outperformed their U.S. counterparts.
The difference between 10-year yields widened 0.4 basis points
to 29.8 basis points.
 In provincial bond news, New Brunswick issued C$300 million
in bonds due 2041, with a spread of 72.5 basis points over the
comparable benchmark 30-year government of Canada bond.
 (Reporting by Ka Yan Ng; editing by Peter Galloway)