December 9, 2019 / 7:34 PM / a month ago

CANADA FX DEBT-Canadian dollar stronger after Friday's sell-off

    * Canadian dollar at 75.56 U.S. cents
    * Bond prices fall across the maturity curve

 (Recasts with U.S., China trade, adds quote, updates prices)
    NEW YORK, Dec 9 (Reuters) - The Canadian dollar gained
against the greenback on Monday as investors focused on whether
the United States will implement new tariffs on China this
weekend, but the loonie pared only half of the losses sustained
on Friday after data showed a slump in domestic jobs.
    The loonie’s move on Monday likely resulted from broader
risk appetite rather than news particular to Canada, said Bipan
Rai, North American head of FX strategy at CIBC Capital Markets
in Toronto.
    “It doesn’t appear like it's any endogenous story to Canada
itself,” Rai said.
    Investors were likely closing positions on uncertainty that
the United States and China will reach a trade deal that will
stop a new round of tariffs against Chinese goods from taking
effect on Dec. 15.
    “When it comes to broad risk this week it’s all about the
December 15 tariffs and if they go into place next Sunday,” Rai
said.
    The Canadian dollar          tumbled to 1.3269 to the U.S.
dollar, or 75.35 cents U.S, after the jobs report.
    It retraced some of these losses to trade at 1.3232, or
75.56 cents, on Monday.
    The Canadian job market lost 71,200 net positions in
November while the unemployment rate rose to 5.9%, the highest
in more than a year, data from Statistics Canada showed.
Analysts had forecast a gain of 10,000 jobs.             
    Bank of Canada Governor Stephen Poloz is due to speak on
Thursday. He is expected to maintain that the central bank’s
rate path will be dependent on data going forward.
    Data on Monday painted a disappointing picture of Canadian
housing.
    Statistics Canada said that the value of Canadian building
permits fell by 1.5% in October from September. Analysts
surveyed by Reuters had expected an increase of 3.0%.
            
    Canadian government bond prices fell with the two-year
           price down 1 Canadian cent to yield 1.66% and the
benchmark 10-year             falling 4 Canadian cents to yield
1.584%.
    
    

 (Reporting by Karen Brettell; editing by Jonathan Oatis and
Steve Orlofsky)
  
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