Reuters: US Dollar Report: CANADA FX DEBT-C$ falls to 2-1/2-month low as earnings bite

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CANADA FX DEBT-C$ falls to 2-1/2-month low as earnings bite Oct 26th 2012, 20:34 Tweet Share this Email Print Fri Oct 26, 2012 4:34pm EDT * C$ ends at C$0.9980 to the U.S. dollar, or $1.0020 * Softens by 0.5 percent over the week * U.S. earnings, Greece worries weigh * Traders brush off in-line U.S. GDP reading By Claire Sibonney TORONTO, Oct 26 (Reuters) - The Canadian dollar hit its weakest level against the U.S. currency in two and a half months on Friday as uninspiring corporate earnings weighed on the market and traders largely brushed off a solid reading of economic growth in the United States. Disappointing results from technology giant Apple Inc and a net loss from Internet retailer Amazon.com Inc dampened market sentiment, as well as concerns that Greece may miss its austerity targets. "There was just a general negative mood in markets that generally supported Treasuries at the expense of equities and the Canadian dollar," said Sal Guatieri, senior economist at BMO Capital Markets. The Canadian dollar ended the North American session at C$0.9980 to the greenback, or $1.0020, compared with C$0.9939, or $1.0061, at Thursday's close. The currency hit an intraday low of C$0.9994, or $1.0006, it weakest level since Aug. 7. The Canadian dollar ended the week down 0.5 percent, after a 1.4 percent decline the week before. Data on Friday showed U.S. economic growth accelerated in the third quarter as stepped-up purchases by consumers and a surprise turnaround in government spending offset the first cutback in business investment in more than a year. But the numbers were still not considered strong enough to make a significant reduction in unemployment. "A better print (on U.S. GDP) seemed to be expected...but moreover people are just expecting earnings season to continue to be poor, and that's going to weigh," said John Curran, senior vice president at CanadianForex. A report showing Spanish unemployment hit a record 25 percent in the third quarter added to gloom about global growth, which can have a pronounced effect on the commodity-linked Canadian dollar. Next week, markets will be paying close attention to Bank of Canada testimony at parliamentary finance and banking committees, as well as monthly U.S. and Canadian jobs data. Adding to uncertainty was the U.S. presidential election on Nov. 6. Highlighting the move into safer assets, prices for Canadian government debt rose across the curve, following U.S. Treasuries. The two-year bond was up 6 Canadian cents to yield 1.119 percent, while the benchmark 10-year bond rose 56 Canadian cents to yield 1.838 percent. Tweet this Link this Share this Digg this Email Reprints Comments (0) Be the first to comment on reuters.com. Add yours using the box above.

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