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* C$ falls to C$1.0326 vs US$, or 96.84 U.S. cents
* C$ following global equities lower
* Bond prices mixed, short end prices firm (Updates to close)
By Andrea Hopkins
TORONTO, Sept 28 (Reuters) - The Canadian dollar ended more than 1 cent weaker against its U.S. counterpart on Wednesday as riskier assets dropped on doubts over Europe's ability to stem a debt crisis that threatens to trigger a global recession.
Canadian and U.S. stock markets fell 2 percent as sharp declines in metals and energy prices weighed on commodity-related shares and underscored concerns about the global economy and Europe's festering debt crisis. [.TO] [.N]
The European Union confirmed negotiators would return to Greece this week to discuss issuing its next tranche of aid, the latest in a series of developments that have not changed the overall picture of uncertainty in the euro zone.
"We're just following equities, really," said Shane Enright, executive director of foreign exchange sales at CIBC World Markets.
"We have the German vote on the EFSF tonight and there is also likely to be comments from the troika that's in Greece looking at the financing package. So I think we're going to continue to trade off the back of European headlines between now and when North American markets open tomorrow morning, and probably through tomorrow morning as well."
European Union and IMF inspectors will return to Athens on Thursday to decide whether the Greek government has done enough to secure help from its neighbors and avoid a default. Germany suggested a new bailout may have to be renegotiated. For details see [ID:nL5E7KS0AC].
The Canadian dollar CAD=D4 ended the North American session at C$1.0326 to the U.S. dollar, or 96.84 U.S. cents, down from Tuesday's North American session close at C$1.0204 to the U.S. dollar, or 98 U.S. cents.
Blake Jespersen, director of foreign exchange sales at BMO Capital Markets, noted significant Canadian-dollar support around C$1.03 and little in the way of resistance until the currency gets back toward parity.
"We continue to see very wide price action on any data and any headline, so markets are definitely jittery and liquidity continues to be a bit of a concern," Jespersen said.
The U.S. dollar also rose on U.S. economic data that showed businesses stepped up investment spending in August, prompting some economists to raise their forecasts for U.S. economic growth this quarter. [ID:nS1E78R088]
Bond prices were mixed. The two-year Canadian government bond CA2YT=RR was up 13.5 Canadian cents to yield 0.95 percent, while the 10-year bond CA10YT=RR fell 38 Canadian cents to yield 2.237 percent. (Additional reporting by Claire Sibonney; Editing by Jeffrey Hodgson)