June 27, 2011 / 1:41 PM / 9 years ago

CANADA FX DEBT-C$ weaker ahead of Greece vote, cooling oil

 * C$ at C$0.9901, or $1.010
 * Bond prices mostly higher across curve
 By Solarina Ho
 TORONTO, June 27 (Reuters) - The Canadian dollar inched
closer to parity against the U.S. dollar on Monday, touching
its weakest level since March as investors remained wary ahead
of a vote in Greece to approve an unpopular austerity plan and
as crude prices fell.
 Investors were concerned that Greece's parliament may not
pass the measures needed for the country to secure more bailout
funds to service its sovereign debt.
 The continued uncertainty over Greece also pressured crude
prices, which have already dropped around 10 percent in recent
sessions, following the International Energy Agency's decision
to release 60 million barrels of oil from its reserves to boost
the economic recovery.
 Oil is a key Canadian export and price movements in the
commodity typically also help drive movements in the currency.
 "The Canadian dollar kind of bounced around on the back of
the Greece headline," said David Bradley, director of foreign
exchange trading at Scotia Capital. "Crude is a little soft,
which is mildly Canadian dollar negative."
 At 9:06 a.m. (1306 GMT), the currency CAD=D4 stood at
C$0.9901 to the U.S. dollar, or $1.010, down from Friday's
North American finish at C$0.9870 to the U.S. dollar, or
$1.0132. Earlier it touched a session low of $0.9914 to the
U.S. dollar, or $1.0087, its weakest level since March 17, when
it touched C$0.9939, or $1.0061.
 South of the border, U.S. consumer spending, which accounts
for 70 percent of U.S. economic activity, came in flat for the
first time in nearly a year, and slipped 0.1 percent when
adjusted for inflation. Personal income also rose less than
expected. The disappointing data added to the general cloud
over the global economy. [ID:nN1E75Q0A1]
 The Canadian dollar was seen remaining weak. Scotia Capital
expected the currency to trade between C$0.9840 to C$0.9920 on
 Canadian bond prices were mostly higher across the curve as
investors moved away from risk. [US/]
 The two-year bond CA2YT=RR was up 7 Canadian cents to
yield 1.352 percent, while the 10-year bond CA10YT=RR added
13 Canadian cents to yield 2.852 percent.
 (Editing by Padraic Cassidy)

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