November 5, 2009 / 2:15 PM / 11 years ago

CANADA FX DEBT-C$ firm after U.S. data, bonds steady

 * Canadian dollar firms to 94.13 U.S. cents
 * Turns positive after U.S. productivity, jobless claims
 * Bonds steady, long end outperforms
 * Markets await Friday's U.S., Canada October jobs data
 TORONTO, Nov 5 (Reuters) - Canada's dollar was slightly
firmer against the U.S. currency on Thursday after data showing
U.S. jobless claims fell and productivity rose at its fastest
pace in six years.
 The reports helped spur investor appetite for riskier
assets, highlighted by a jump in U.S. stock futures after the
report. [ID:nN05106320] [.N]
 "Intraday we'll probably hinge off risk appetite, and what
equity markets do. The Fed kept policy accommodation intact
yesterday ... that suggests the U.S. dollar is generally going
to struggle here," said Shaun Osborne, chief currency
strategist, at TD Securities.
 The Canadian currency had hit its highest level in more
than a week on Wednesday after the U.S. Federal Reserve kept
its commitment to low borrowing costs for an "extended
 At 8:55 a.m. (1355 GMT), the Canadian dollar was at
C$1.0624 to the U.S. dollar, or 94.13 U.S. cents, up from
C$1.0638 to the U.S. dollar, or 94.00 U.S. cents, at
Wednesday's close.
 Still, many market players were expected to hold back from
major commitments ahead of jobs data from Canada and the U.S.
 "It seems very quiet market at the moment. Markets are sort
of struggling for direction in the short term after a fair bit
of event risk this week and more to come. There's probably not
much appetite to get involved at these levels," said Osborne.
 Market watchers will study Friday's employment reports from
both Canada and the United States for further clues on the
strength of the economic recovery. Canada is expected to show
the economy added 10,000 jobs in October. [ID:nN04446691]
 Statistics Canada said on Thursday that permits for housing
construction in Canada surged to a one-year high in September,
driving up the value of overall building permits by 1.6 percent
from August as expected. [ID:nN05106233]
 Overnight weakness pushed the Canadian currency as low as
C$1.0682 to the U.S. dollar, or 93.62 U.S. cents, as perceived
higher risk currencies fell on profit-taking ahead of interest
rate decisions by the Bank of England and the European Central
Bank. Both central banks kept rates unchanged.
 Meantime, Canadian bond prices were little changed to
weaker as market players marked time ahead of the jobs data.
 The two-year bond CA2YT=RR was up 1 Canadian cent at
C$99.69 to yield 1.403 percent, while the 10-year bond
CA10YT=RR was down 12 Canadian cents C$102.03 to yield 3.497
 (Reporting by Ka Yan Ng; Editing by Jeffrey Hodgson)

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