Canada exporters on sidelines as C$ sinks, eye weaker levels -dealers
* C$ hits 12-year low of C$1.4245, or 70.20 U.S. cents
* Exporters waiting for move to C$1.40 now see deeper losses
* Dealers say risk-averse importers locking in hedges
By Fergal Smith
TORONTO, Jan 11 (Reuters) - Canadian exporters are holding off using their earnings to buy Canadian dollars or lock in hedges as the currency hits 12-year lows, betting it can weaken even further, foreign exchange dealers say.
The Canadian currency has plunged about 36 percent against the U.S. dollar since November 2007, hitting a low of C$1.4245, or 70.20 U.S. cents, on Monday. Most of that move has come since mid-2014, when the price of crude oil, one of Canada's major exports, began its sharp sell-off.
In a sign of deteriorating sentiment, dealers say exporters who were waiting for the currency to cross C$1.40 now sense additional weakness is in store, given uncertainty about China, even lower crude oil and financial market volatility.
"Greed breeds inaction," said Michael Goshko, corporate risk manager at Western Union Business Solutions.
The speed of the move has "pushed corporate Canada to the sidelines," said Brad Schruder, director of foreign exchange at BMO Capital Markets. Continued...