CANADA FX DEBT-C$ weakens as Ukraine vote on Sunday stirs safety bid
* Canadian dollar at C$1.1095 or 90.13 U.S. cents * Bond prices mixed across the maturity curve By Leah Schnurr TORONTO, March 14 (Reuters) - The Canadian dollar weakened against the greenback on Friday, a day after a strong gain, as worries ahead of a referendum in Crimea on separating from Ukraine prompted investors to push into safer assets. The only domestic economic data that had been on tap for the day showed the ratio of Canadian household debt to income in the fourth quarter of last year slipped to 164 percent after hitting a record high in the third quarter. The report had little impact on the loonie. Overseas, Russia shipped more troops and armor into Crimea on Friday and repeated its threat to invade other parts of Ukraine. Pro-Moscow authorities in Crimea will hold a vote over the weekend on whether the peninsula should leave Ukraine and join Russia, a move that would likely to lead to U.S. and EU sanctions. The European Union is expected to impose travel bans and asset freezes next week on dozens of Russians involved in Moscow's gradual takeover of Crimea, European diplomats said. "The market's just got a cautionary tone going into that event risk," said Gareth Sylvester, director at Klarity FX in San Francisco. "It absolutely just heightens tensions between the Europeans and Russia." The Canadian dollar ended the North American session at C$1.1095 to the greenback, or 90.13 U.S. cents, weaker than Thursday's close of C$1.1053, or 90.47 U.S. cents. "The big worry is that the outcome of the referendum is a 'yes' to essentially breaking away from Ukraine," said Scott Smith, senior market analyst at Cambridge Mercantile Group in Calgary. "It's definitely moving to escalating where there will be sanctions against Russia - the ball is already in motion with that - and will likely see tensions really escalate and movement from the West escalate as well." Investors also remained concerned about the strength of the Chinese economy after disappointing data earlier in the week. The loonie is sensitive to developments in China, which is the world's second largest economy and a major consumer of resources. Firmer oil prices helped underpin the Canadian dollar, preventing it from falling too steeply, Smith said. Canadian government bond prices were mixed across the maturity curve, with the two-year unchanged to yield 1.007 percent and the benchmark 10-year off 5 Canadian cents to yield 2.392 percent.
© Thomson Reuters 2016 All rights reserved.