*C$ hits high of C$1.0111 vs US$, or 98.90 U.S. cents
*Bonds prices fall across the curve
(Updates with details, commentary)
By Claire Sibonney
TORONTO, Oct 14 (Reuters) - Canada's currency pushed to a session high against the U.S. dollar on Friday morning, outperforming most of the G10 majors as North American economic data beat expectations.
Canadian manufacturing sales surged for a second straight month in August, at nearly three times the pace as expected, as large aerospace production outweighed a decline in the auto sector. [ID:nS1E78E05E]
South of the border, U.S. retail sales rebounded in September at their fastest pace in seven months as consumers shook off some of their concerns about stock market slides and political gridlock, potentially giving new momentum to the weak economic recovery. [ID:nCAT005534]
The U.S. numbers carried a lot of weight, said David Tulk, chief Canada macro strategist at TD Securities. "Especially in the consumer sector, where we're looking for some sense of optimism."
The Canadian dollar CAD=D4 rose as high as C$1.0111 to the U.S. dollar, or 98.90 U.S. cents, from around C$1.0138, or 98.64 U.S. cents, immediately before the reports.
The currency had already been in positive territory, shrugging off a credit rating downgrade in Spain. Risker assets were lifted by hopes of progress towards a solution to the euro zone's debt crisis later this month and by strong earnings from Google Inc.
At 9:23 a.m. (1313 GMT), the Canadian dollar stood at C$1.0118 against the U.S. dollar, or 98.83 U.S. cents, up from Thursday's North American session at C$1.0197 to the U.S. dollar, or 98.07 U.S. cents.
Canadian bond prices were lower across the curve, extending losses alongside U.S. Treasuries after the positive data. [US/]
The two-year Canadian government bond CA2YT=RR fell 13 Canadian cents to yield 1.0148 percent, while the 10-year bond CA10YT=RR dropped 78 Canadian cents to yield 2.378 percent.
(Reporting by Claire Sibonney, Editing by Chizu Nomiyama)