October 11, 2017 / 9:42 PM / 3 years ago

CANADA FX DEBT-C$ notches 1-week high as Fed minutes weigh on greenback

    * Canadian dollar at C$1.2460, or 80.26 U.S. cents
    * Loonie touches its strongest since Oct. 4 at C$1.2453
    * Bond prices mixed across a flatter yield curve
    * Oil prices settle 38 cents higher at $51.30 a barrel

    By Fergal Smith
    TORONTO, Oct 11 (Reuters) - The Canadian dollar climbed to a
one-week high on Wednesday against its U.S. counterpart as oil
rose and after minutes from the latest Federal Reserve meeting
weighed on the greenback.    
    The U.S. dollar        fell to a two-week low against a
basket of currencies as several Fed officials expressed they
would like more inflation data in the next few months when
deciding on future rate hikes.
    "It has been just a one-way direction for the U.S. dollar
against all the majors," said Eric Theoret, currency strategist
at Scotiabank. "They (Fed policymakers) are willing to be
patient to get the data that they need in order to hike"     
    In contrast, the Bank of Canada has raised rates twice since
July, trusting its projections and betting that stronger growth
will help push inflation to its target by the middle of next
    Prices of oil, one of Canada's major exports, rose for the
third day as the Organization of the Petroleum Exporting
Countries forecast higher demand for 2018 and heightened
tensions in Kurdistan supported prices.
    U.S. crude        prices settled 38 cents higher at $51.30 a
    At 5 p.m. EDT (2100 GMT), the Canadian dollar          was
trading at C$1.2460 to the greenback, or 80.26 U.S. cents, up
0.4 percent.
    The currency's weakest level of the session was C$1.2530,
while it touched its strongest since Oct. 4 at C$1.2453.
    U.S. President Donald Trump said he would be open to doing a
bilateral trade deal with Canada but not Mexico if talks between
the three countries over the North American Free Trade Agreement
fall apart.             
    Canada sends about 75 percent of its exports to the United
States. Its economy could suffer if NAFTA is abandoned.
    Canadian government bond prices were mixed across a flatter
yield curve, with the two-year            down 0.5 Canadian cent
to yield 1.552 percent and the 10-year             rising 11
Canadian cents to yield 2.111 percent.

 (Reporting by Fergal Smith; Editing by Lisa Shumaker)
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