* Canadian dollar up as Geithner’s comments hit greenback
* Rising equity markets lend support, oil pares losses
* C$ still relatively range-bound (Updates to midday)
TORONTO, March 25 (Reuters) - The Canadian dollar reversed early weakness on Wednesday as the U.S. currency was undercut by comments from U.S. Treasury Secretary Timothy Geithner and by rising equity markets.
The flight-to-safety appeal of the U.S. currency was also hurt by better-than-expected U.S. durable goods orders for February and a jump in new home sales. [ID:nLP953349]
Geithner’s comments that were the main catalyst that drew the U.S. dollar into a volatile spin as he expressed openness to expanded use of an IMF currency basket even as he said the greenback would remain the world’s reserve currency for a long time. [ID:nN25418099]
Despite the weaker U.S. dollar, however, the Canadian currency stayed in the same C$1.22-C$1.24 range it has been in all week.
At noon (1600 GMT), the Canadian currency was at C$1.2254 to the U.S. dollar, or 81.61 U.S. cents, up from C$1.2318 to the U.S. dollar, or 81.18 U.S. cents, at Tuesday’s close.
“Currencies were jumping around on Geithner’s comments,” said Shane Enright, currency strategist at CIBC World Markets.
“In general though, we haven’t really deviated far from the levels we saw yesterday. We’re still very much in familiar territory. The C$1.22 level seems to be key short-term (U.S. dollar) support here and today we haven’t really seriously threatened that.”
Stronger equity markets lent some support to the Canadian dollar, while the price of oil pared losses and neared $54 a barrel after Geithner’s remarks. The currency has taken cues on direction from equity and commodity markets lately, considering them a barometer of risk sentiment.
Meanwhile, Canadian government bonds held in negative territory as stocks climbed, shrugging off a large purchase of government debt made by the U.S. Federal Reserve.
The New York Federal Reserve bought $7.5 billion in longer-dated Treasury securities whose maturities range from 2016 to 2019, part of the U.S. central bank’s program to help lower long-term borrowing costs. [ID:nNYE000537]
The two-year bond fell 3 Canadian cents to C$100.12 to yield 1.193 percent. The 10-year bond slipped 42 Canadian cents to C$107.03 to yield 2.944 percent.
The 30-year bond lost 50 Canadian cents to C$122.35 to yield 3.714 percent. The U.S. 30-year bond yielded 3.691 percent. (Reporting by Ka Yan Ng; editing by Peter Galloway)
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