CANADA FX DEBT-C$ boosted by higher oil, equity rally

Thu Oct 30, 2008 9:46am EDT
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* Canadian dollar comfortably off Tuesday's multi-year low

* Higher commodity prices and risk appetite fueling gains

* Bond prices dumped in wake of global equity market rally

By Frank Pingue

TORONTO, Oct 30 (Reuters) - The Canadian dollar rallied to a 10-day high versus the U.S. dollar on Thursday as a rise in prices for oil, a key Canadian export, helped the currency move further off its recent multi-year low.

Bond prices were stuck lower across the curve as a rise in global equity markets crimped demand for secure government debt, but the slide was cushioned as the latest Canadian data came in weaker than expected.

At 9:35 a.m. (1435 GMT), the Canadian unit was at C$1.2066 to the U.S. dollar, or 82.88 U.S. cents, up from C$1.2250 to the U.S. dollar, or 81.63 U.S. cents, at Wednesday's close.

During the overnight session the Canadian currency rallied to C$1.1897 to the U.S. dollar, or 84.05 U.S. cents, its highest level since Oct. 20.

The sudden turnaround in the dollar has been pegged to a slew of factors including higher prices for Canadian exports such as oil and gold and an improved market sentiment that helped lure investors back to equity markets.   Continued...