May 4, 2011 / 12:28 PM / 9 years ago

CANADA FX DEBT-C$ tips higher, eyes resource prices

 * C$ edges up to $1.0503, gains capped by resource drag
 * Bond prices flat-to-lower
 TORONTO, May 4 (Reuters) - Canada's dollar was little
changed against the U.S. currency on Wednesday, weighed down by
softness in the price of U.S. crude oil and other commodities.
 A broad sell-off in commodities also dragged equities lower
and dampened investor appetite for risk-taking, after fear that
huge price gains last month had made everything from oil to
silver too costly. However, Canadian government bond prices
were flat to lower in the face of lower global equity markets.
 "One of the dominant stories in recent days is some of the
pullback in commodities, especially the precious metals. That's
continuing today," said Doug Porter, deputy chief economist at
BMO Capital Markets.
 Still, the currency traded in a fairly tight range on
Wednesday morning, moving in a 29-tick range between
C$0.9520-C$0.9549, according to Reuters data.
 "To me, one of the more interesting stories here is how
little movement we've seen in the Canadian dollar in the last
couple of days given the news flow, the big moves in
commodities, and election results," said Porter.
 "Basically it looks like those two forces have more or less
fought to a draw and we've had very little net movement in the
Canadian dollar."
 Canada's Conservatives won a long-coveted majority mandate
in Monday's federal election. The prospect of a more stable
government pushed the currency to near 3-1/2 year high though
had little lasting impact.
 The currency may not find a catalyst to move it off its
perch until this Friday's jobs data from both Canada and the
United States. Canada is expected to have created 22,500 jobs
in April. ECONCA
 At 8:10 a.m. (1210 GMT), the Canadian dollar CAD=D4 was
at C$0.9521 to the U.S. dollar, or $1.0503, up from C$0.9526 to
the U.S. dollar, or $1.0498, at Tuesday's close.
 The two-year bond CA2YT=RR was unchanged to yield 1.698
percent, while the 10-year bond CA10YT=RR slipped 13 Canadian
cents to yield 3.174 percent.
 Canada to auction C$2.5 billion in 10-year bonds later in
the session.
 (Reporting by Ka Yan Ng; Editing by Theodore d'Afflisio)

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