CANADA FX DEBT-C$ firms to four-week high after strong permits data
* C$ at C$1.0374 vs US$, or 96.39 U.S. cents * Building permits soar 20.7 percent vs expected 1 pct * Bond prices rise across the curve By Solarina Ho TORONTO, Sept 9 (Reuters) - The Canadian dollar touched its firmest level in about four weeks against a broadly weaker U.S. dollar on Monday, tracking other commodity-linked currencies, in the wake of surprisingly strong Canadian building permits data, which hit a record. The construction sector was unexpectedly robust in July, with the permits issued jumping 20.7 percent, far surpassing the 1 percent rise economists polled by Reuters had expected. Most of the gains were for commercial buildings, while housing saw a more modest rise. "There was a slight uptick for Canada (dollar) strengthening as we got the building permits data. Most of the time, people ignore it because it's such a volatile report," said Mark Chandler, head of Canadian fixed income and currency strategy At RBC Capital Markets. "But within the guts of the report, there was still some pretty good news on housing. If you look at the unit sales data, it's the fourth month that we've seen it over 200,000." The Canadian dollar was trading at C$1.0374 versus the U.S. dollar, or 96.39 U.S. cents at 9:30 a.m. (1330 GMT), stronger than Friday's North American finish at C$1.0409, or 96.07 U.S. cents. It firmed to C$1.0364, or 96.49 U.S. cents shortly after the data, it's strongest level since Aug. 20. Prior to the move, the Canadian dollar was already benefiting from a U.S. dollar that was weaker against most currencies except for the Japanese yen, said Chandler, noting that the Canadian dollar was keeping pace with other commodities currencies, like the Australian and New Zealand dollars. The U.S. dollar weakness follows last Friday's disappointing U.S. jobs report, spurring further debate on when the U.S. Federal Reserve might begin scaling back its stimulus program. RBC Capital Markets was expecting the currency to trade between C$1.0360 and C$1.0410 on Monday. With little data on tap both in the United States and Canada this week, broader currency movements are expected to be dictated by developments in Syria, said Chandler. Prices for Canadian government debt rose across the maturity curve, with the two-year bond up 4 Canadian cents to yield 1.271 percent and the benchmark 10-year bond climbing 37 Canadian cents to yield 2.725 percent.
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