November 17, 2011 / 9:59 PM / in 9 years

CANADA FX DEBT-C$ hits one-month low on European debt fears

 * C$ ends at C$1.0283 vs US$, or 97.25 U.S. cents
 * Touches weakest level since Oct. 12
 * Bond prices mixed
 (Updates to close, adds comment)
 By Jennifer Kwan
 TORONTO, Nov 17 (Reuters) - The Canadian dollar sank
against the U.S. currency for a fourth straight session on
Thursday, following a sell-off in global equity and commodity
prices on mounting concerns Europe's debt crisis will spread.
 The safe-haven greenback rose and commodity currencies such
as the Australian, Canadian, and New Zealand dollars notched
losses as investors grew frustrated the two-year old debt
crisis is far from being resolved. [FRX/]
 "Risk is really not trading particularly well today," said
Darcy Browne, managing director, fixed income and currencies
with CIBC Capital Markets Trading.
 The Canadian dollar  CAD=D4 hit a low of C$1.0296 against
the U.S. dollar, or 97.13 U.S. cents, its weakest level since
Oct. 12.
 The currency ended at C$1.0283 versus the greenback, or
97.25 U.S. cents, down from Wednesday's North American session
close at C$1.0229 against the U.S. dollar, or 97.76 U.S. cents.
The currency has fallen more than 1.6 percent so far this
 World stocks and oil prices fell on Thursday as a rise in
Spain's borrowing costs to almost 7 percent at an auction fed
fears that the euro zone debt crisis could spread further.
 In the absence of any real resolution in Europe it's
unlikely risk-sensitive currencies or commodities will have any
meaningful gains in the short term, said Browne.
 European developments overshadowed news that foreigners
continued to invest in Canadian securities in September
although at a somewhat slower pace than in August, adding a
near-record amount of short-term debt instruments to their
portfolios. [ID:nN1E7AG0BA]
 Canadian government bond prices were mixed.
 The two-year bond CA2YT=RR fell 2 Canadian cents to yield
0.900 percent, while the 10-year bond CA10YT=RR was down 3
Canadian cents to yield 2.1 percent. The 30-year bond
CA30YT=RR climbed 15 Canadian cents to yield 2.7 percent.
 (Editing by Jeffrey Hodgson)

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