CANADA FX DEBT-C$ ends unchanged after earlier strength as uncertainty looms
* Canadian dollar closes unchanged C$1.0947 or 91.35 U.S. cents * Bond prices mixed across the maturity curve By Solarina Ho TORONTO, Sept 19 (Reuters) - The Canadian dollar closed unchanged against the greenback on Friday after touching its firmest in nearly two weeks, as market participants looking for a safe haven bolstered the U.S. dollar. The Canadian dollar had strengthened early in the session after Canadian inflation data showed the closely watched core inflation rate unexpectedly jumped above 2 percent in August. "That's been offset by this newfound uncertainty that's taken place in the markets," said Bipan Rai, director of foreign exchange strategy at CIBC World Markets in Toronto, saying this week's policy statement by the U.S. Federal Reserve offered conflicting messages. "Price action like this is consistent with a market that's worried about uncertainty and gravitating towards the U.S. dollar," Rai said. The Fed renewed its pledge to keep interest rates near zero for a "considerable time", but also indicated it could raise borrowing costs faster than expected when it starts moving. The U.S. dollar gained against a basket of major currencies , posting its 10th consecutive week of gains, as investors bet U.S. interest rates would rise more quickly than had been expected. The Canadian dollar, which was outperforming most of its counterparts, finished unchanged from Thursday's Bank of Canada close of C$1.0947, or 91.35 U.S. cents. Earlier, it briefly touched C$1.0887, or 91.85 U.S. cents, its strongest level in nearly two weeks. In Canada, the overall annual inflation rate was steady at 2.1 percent, in line with analysts' expectations, but above the Bank of Canada's 2 percent target for the fourth straight month. However, the core rate, which strips out the prices of some volatile items, rose to 2.1 percent last month from 1.7 percent in July, hitting a level last seen in April 2012. Canadian government bond prices were mixed across the maturity curve, with the two-year down half a Canadian cent to yield 1.172 percent and the benchmark 10-year up 25 Canadian cents to yield 2.254 percent. (Editing by Peter Galloway and James Dalgleish)
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