December 24, 2009 / 1:27 PM / 11 years ago

CANADA FX DEBT-C$ higher as greenback retreats

 * C$ up at 95.58 U.S. cents
 * Bonds flat across the curve
 TORONTO, Dec 24 (Reuters) - The Canadian dollar extended
gains on Thursday morning, touching its highest level in nearly
three weeks, as the unit rose on broad weakness in the U.S.
 With marginal moves in global equity, oil and gold prices,
the Canadian dollar is largely being swayed by moves in the
greenback, said Matthew Strauss, senior currency strategist at
RBC Capital Markets.
 It's "just reaction to a broad-based U.S. dollar selloff,"
Strauss said.
 The greenback fell on Thursday, coming off three-month
highs against a basket of currencies after weak U.S. housing
data in the previous session dampened optimism about the
outlook for the U.S. economy. [FRX/]
 In thin pre-holiday trade, investors awaited U.S. weekly
jobless claims and durable goods data.
 World stocks pushed to their highest level in nearly three
weeks, while oil prices sagged and gold edged slightly higher.
 The Canadian dollar also built on momentum after comments
by Finance Minister Jim Flaherty, who said that China and
Russia may diversify their currency reserves into Canadian
dollars. [FRX/]
 Those comments built on remarks by Prime Minister Stephen
Harper that Ottawa will be fiscally disciplined as the
government continues stimulus spending until 2011.
 "It clearly seems as if Canada is back in favor and is the
flavor of the month in the currency world, so the markets are
quick to latch on to positive Canadian dollar news," said
 The Canadian dollar touched its highest level since early
December. At 7:56 a.m. (1256 GMT), the Canadian dollar was at
C$1.0462 to the U.S. dollar, or 95.58 U.S. cents, up from
Wednesday's finish at C$1.0484 to the U.S. dollar, or 95.38
U.S. cents.
 With no major domestic economic data on tap, Canadian bond
prices were largely flat across the curve as investors were
unwilling to make major bets in holiday-shortened trade.
 (Reporting by Jennifer Kwan; Editing by Padraic Cassidy)

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