June 15, 2009 / 12:42 PM / 11 years ago

CANADA FX DEBT-C$ slides as greenback gains broadly

 TORONTO, June 15 (Reuters) - The Canadian dollar fell
sharply against the U.S. dollar on Monday, pressured by a
return of risk aversion, and as the greenback gained broadly
after Russia's finance minister expressed confidence in the
 Investors also awaited an announcement from the leader of
Canada's main opposition Liberal Party, who will on Monday
morning say whether he is satisfied by how Ottawa is tackling
the economic crisis.
 At 7:51 a.m. (1351 GMT) trades were at C$1.1322, or 88.32
U.S. cents, down from Friday's finish at C$1.1179 to the U.S.
dollar, or 89.45 U.S. cents.
 "We are seeing U.S. dollar strength returning across the
board. It's partly because of risk aversion returning, partly
because the G8 meeting is out of the way," said Matthew
Strauss, senior currency strategist, RBC Capital Markets,
adding there were concerns the Group of Eight communique might
make reference to the recent weakness in the currency.
 The U.S. dollar gained broadly on Monday after Russia's
finance minister said the dollar's role as the main reserve
currency was unlikely to change in the near future. [FRX/]
 Canada is a major oil producer and the currency was
pressured by a drop in oil prices CLc1 to around $71 a
barrel, pushed lower in part by the U.S. dollar's rise.
 Weakness in global equities also played a factor in the
weak Canadian currency, [MKTS/GLOB] while U.S. stock index
futures pointed to a lower open. [ID:nN15170481]
 Last week, the Canadian dollar came under pressure from
comments made by Bank of Canada Governor Mark Carney that the
rapid appreciation of the Canadian currency could hinder
economic recovery. Shortly after Carney's remarks, Finance
Minister Jim Flaherty said the rise of the currency is a
concern "if there's a speculative element".
 As of Monday morning, the Canadian dollar has risen about
15 percent against the greenback since early March.
 Canadian bond prices were mostly higher, tracking the U.S.
Treasury market, which rose on Monday as declines in regional
stock markets boosted the bid for less risky fixed-income
assets.  [ID:nLF389225]
  (Reporting by Jennifer Kwan; Editing by Padraic Cassidy)

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