CANADA FX DEBT-C$ slips as investors watch earnings and U.S. debt battle

* C$ weaker at C$0.9853 vs US$, or $1.0149
    * Bond prices rise across the curve

    By Claire Sibonney
    TORONTO, Jan 15 (Reuters) - The Canadian dollar slipped
against the U.S. currency on Tuesday, tracking weakness in U.S.
equities over worries about  the looming battle in Washington
over the borrowing limit and expectations for a dull earnings
    World equity markets also stalled near 18-month highs after
President Barack Obama on Monday rejected any negotiations with
Republicans over raising the U.S. debt ceiling. The United
States could default on its debt if Congress does not increase
the borrowing limit.  
    Adam Cole, global head of FX strategy at RBC Capital Markets
in London said the Canadian dollar "is a bit softer on the day
on the back of a slightly negative tone for risky assets
    He said that direction from global equities "will be put to
the test more harshly" on Wednesday when there will be a spate
of Q4 earnings reports. 
    In what is expected to be a lackluster earnings season,
reports are due this week from Goldman Sachs, Bank of
America, Intel and General Electric,
among other companies. Third-quarter reports ended with a gain
of just 0.1 percent, the worst for an S&P 500 profit period in
three years, according to Thomson Reuters data. 
    Analyst estimates for the quarter have fallen sharply since
October. S&P 500 earnings growth is now seen up just 1.9 percent
from a year ago, Thomson Reuters data showed.
    At 9:18 a.m. (1418 GMT), the Canadian dollar was
trading around C$0.9853 versus the U.S. dollar, or $1.0149,
weaker than Monday's North American session close at C$0.9838
versus the greenback, or $1.0165.
    The Canadian dollar trimmed some losses on Monday after data
showed U.S. retail sales rose more than expected in December.
    Still, the currency continued to trade in a narrow range on
Tuesday between C$0.9833-67.
    RBC noted near-term U.S. dollar resistance around C$0.9934
and support at C$0.9826.
    "It's still stuck in the  C$0.98 to parity range as we have
been for so long now," added Cole.
    Canadian bond prices edged higher across the curve,
following U.S. Treasuries up. The two-year bond 
was up 3 Canadian cent to yield 1.180 percent, while the
benchmark 10-year bond climbed 26 Canadian cents to
yield 1.910 percent.