* C$ at C$0.9941 to US$, or $1.0059
* Greek deal expected; disappointment could roil markets
* Stalled U.S. budget discussions also weigh
By Alastair Sharp
TORONTO, Nov 26 (Reuters) - The Canadian dollar was slightly
weaker in early trade on Monday as investors awaited the results
of Greek debt aid talks and worried about pending U.S. tax hikes
and spending cuts.
Euro zone finance ministers and the International Monetary
Fund are attempting to release emergency aid for Greece for the
third time in as many weeks, but they first need to agree if
some of the official loans to Athens might eventually be
forgiven to cut Greek debt.
"The market is probably set up for something fairly decisive
today (on Greece)," said Adam Cole, global head of FX strategy
at RBC Capital Markets in London. "If they fail to agree yet
again it could be quite violently negative."
U.S. lawmakers have made little progress in the past 10 days
toward a compromise to avoid the "fiscal cliff" of harsh tax
increases and government spending cuts due to start to kick in
in the new year, a senior Democratic senator said on Sunday.
At 9:07 a.m. (1407 GMT) the Canadian dollar was
trading at C$0.9941 to the greenback, or $1.0059, compared with
C$0.9920, or $1.0081, at Friday's North American close.
The two-year bond was up 3 Canadian cents to
yield 1.108 percent, while the benchmark 10-year bond
was up 25 cents to yield 1.758 percent.