February 6, 2012 / 2:38 PM / in 6 years

CANADA FX DEBT-C$ stumbles on mounting Greek concerns

* C$ at C$0.9985 to the US$, or US$1.0015

* Greek debt worries weigh on market

* Bond prices mostly higher

By Jon Cook

TORONTO, Feb 6 (Reuters) - The Canadian dollar weakened against its U.S. counterpart on Monday, falling in tandem with the euro, as worries about Greece’s unresolved debt deal took the lustre off Friday’s confidence-boosting U.S. jobs data.

A European Commission spokesman said Greece had already gone beyond the deadline for finalising talks on the second financing package from the euro zone and the International Monetary Fund, and Athens needed urgently to take decisions.

“It’s got the market’s full attention at the moment,” said Steve Butler, director of foreign exchange trading at Scotia Capital. “The longer we wait and the closer we get to the next deadline the more difficult things become.”

Greece’s coalition members must agree to painful terms of a new bailout worth 130 billion euros ($170.6 billion) before euro zone finance ministers next meet. Failure to reach a deal would leave the prospect of an unmanaged Greek debt default when bond repayments fall due in March.

At 9:18 a.m. (1418 GMT), the Canadian dollar was at C$0.9985 to the U.S., or US$1.0015, down nearly half a cent from where it finished on Friday at C$0.9936 against the greenback, or US$1.0064.

On Friday, Canada’s currency surged to C$0.9928, its strongest level since Oct. 31, after data showed the American economy added 243,000 jobs, the most since last April.

The currency firmed higher early on Monday, but slumped after the latest setback by Greece as the euro hit a low of $1.3030 on trading platform EBS after stop loss orders were tripped below $1.3050.

“Everything was looking quite rosy and now it looks like we’re on the defensive this morning as we await some sort of resolution,” said Butler.

In the near term, Butler saw the Canadian dollar hovering between its 200-day moving average at about C$0.9960 and C$1.0040.

Canadian bond prices were mostly higher across the curve with the two-year bond up 2 Canadian cents to yield 1.028 percent. The 10-year bond rose 22 Canadian cents to yield 1.988 percent. (Editing by Jeffrey Hodgson)

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