CANADA FX DEBT-C$ at six-week low after strong U.S. GDP data
* Canadian dollar at C$1.0887 or 91.85 U.S. cents * Bond prices lower across the maturity curve By Leah Schnurr TORONTO, July 30 (Reuters) - The Canadian dollar weakened to a six-week low against the greenback on Wednesday after data showed a bigger-than-expected pick up in growth south of the border, boosting the U.S. dollar to the detriment of the loonie. U.S. gross domestic product expanded at a 4 percent annual rate in the second quarter, recovering from a decline in the first three months of the year. "It conforms to the overall trend in the U.S. dollar that we have been seeing in recent days. There is support for the greenback against the major crosses," said Martin Schwerdtfeger, FX strategist at TD Securities in Toronto. "The stronger-than-expected GDP number was the catalyst that was needed to cement those moves higher for the U.S. dollar, and the loonie was no exception." A separate report released at the same time showed industrial product prices in Canada edged down in June, but the report was largely eclipsed by the U.S. data. The Canadian dollar was at C$1.0887 to the greenback, or 91.85 U.S. cents, weaker than Tuesday's close of C$1.0859, or 92.09 U.S. cents. The loonie has lost more than 1 percent in the last four sessions that have been punctuated by two significant selloffs. The declines have pushed the currency through key technical levels and out of the tight range it traded in for half of July. Schwerdtfeger expects the next leg lower will take the Canadian dollar into the mid-C$1.09 area and it could decline further to C$1.10 in coming months if U.S. economic data remain strong. Still on tap later in the day is a policy statement from the U.S. Federal Reserve at the conclusion of its two-day meeting. The central bank is expected to continue winding down its bond-buying and investors will be looking for any insight on when the Fed could eventually raise rates. Canadian government bond prices were lower across the maturity curve, with the two-year down 2-1/2 Canadian cents to yield 1.094 percent. The benchmark 10-year was down 25 Canadian cents to yield 2.120 percent, coming off the previous day's lowest level in over a year for yields. (Reporting by Leah Schnurr; Editing by Nick Zieminski)
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