April 30, 2010 / 1:30 PM / in 10 years

CANADA FX DEBT-C$ little changed after Canada, U.S. GDP data

 * C$ at C$1.0059 to the U.S. dollar, or 99.41 U.S. cents
 * Bond prices slightly higher across the curve
 (Adds details about GDP data, quote)
 By Jennifer Kwan
 TORONTO, April 30 (Reuters) - Canada's dollar was little
changed against the U.S. currency on Friday after data showed
Canada's economy grew an as-expected 0.3 percent in February,
but growth in the U.S. came in weaker than expected.
 It was the sixth consecutive monthly domestic increase,
pushed higher by stronger manufacturing and the Olympics,
Statistics Canada said on Friday. Analysts polled in advance by
Reuters had expected a 0.3 month-on-month increase.
 At 9:14 a.m. (1314 GMT), the Canadian dollar CAD=D4 was
at C$1.0059 to the U.S. dollar, or 99.41 U.S. cents, slightly
weaker than about C$1.0054 just before the release of the GDP
data. On Thursday, the currency finished at C$1.0054 to the
U.S. dollar, or 99.46 U.S. cents.
 "Canada's growth rate was solid. No major surprise for the
markets," said Doug Porter, deputy chief economist at BMO
Capital Markets.
 "The combination of both numbers we saw in the North
America today were close enough to consensus that they didn't
change the outlook one way or another," added Porter.
 The U.S. dollar held steady at lower levels versus the euro
on Friday after a government report showed the U.S. economy
grew at a slightly slower-than-expected pace in the first
quarter. [FRX/] [ID:nN2926503]
 But U.S. stock index futures pared gains and pointed to a
flat open on Friday as worries over debt-laden Greece eased and
the economy grew in the first quarter but at slightly
slower-than-expected pace. [.N]
 More broadly, however, the Canadian dollar was holding its
ground, said Sacha Tihanyi, a currency strategist at Scotia
 "The Canadian dollar is holding in quite well in recent
sessions despite some weakness and now with easing of fears in
Europe on the potential announcement of an austerity package
and money being given to Greece, it's really the euro show
today," said Tihanyi.
 BMO's Porter said the broader market still has major
concerns about sovereign risk.
 "As long as that continues to overhang the market it could
be tough ... for any remotely risky investments like the
Canadian dollar," he said.
 Canadian bond prices were slightly higher across the curve,
following moves in the U.S. Treasuries which erased losses and
turned flat briefly on Friday after the weaker-than-expected
U.S. economic growth. [US/]
 "We have seen a bit of strengthening in Canada. I wouldn't
put it down to the GDP numbers, which were basically on the
money. There may have been a little bit of concern that GDP
would surprise on the high side and there's a bit of relief in
bonds that it came in as expected," said Porter.
 The two-year Canadian government bond CA2YT=RR was up 10
Canadian cents to C$99.20 to yield 1.946 percent, while the
10-year bond CA10YT=RR was higher by 30 Canadian cents at
C$98.30 to yield 3.704 percent.
 (Additional reporting by Claire Sibonney; Editing by Jeffrey

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