Reuters: US Dollar Report: CANADA FX DEBT-With Wall St. shut, C$ drifts near 12-week low

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CANADA FX DEBT-With Wall St. shut, C$ drifts near 12-week low Oct 30th 2012, 19:55 Tweet Share this Email Print Tue Oct 30, 2012 3:55pm EDT * C$ at C$0.9999 vs US$, or $1.0001 * Touches weakest level since Aug. 6 * Approach of month-end could further weaken C$ By Claire Sibonney TORONTO, Oct 30 (Reuters) - The Canadian dollar was near parity with its U.S. counterpart on Tuesday, after touching its weakest level since August earlier in the day, as it struggled for direction after the biggest storm to hit the United States in generations shut down Wall Street for a second day. Millions of people were left reeling in the aftermath of monster storm Sandy with New York and a wide swath of the eastern United States trying to deal with flooding and power outages. The death toll climbed to at least 30. As markets sought to grasp the full impact of the storm, world trading of shares and commodities was subdued, providing little direction for the Canadian dollar. "It's just incredibly quiet with a lot of the market out, equities and bonds in the U.S. closed, it's like a national holiday type of liquidity in the market," said Matt Perrier, director of foreign exchange sales at BMO Capital Markets. "There's not a whole lot going through here. We've been stuck in a very tight range with little flows of note." The currency has traded in a band of less than 50 basis points since Monday, and Perrier said the current range of between C$0.9975-C$1.0025 should hold heading into the overnight session. At 3:21 p.m. (1921 GMT) the Canadian dollar was trading at C$0.9999 to the greenback, or $1.0001, compared with C$1.0008, or $0.9992, at Monday's North American close. The currency at one pointed hit C$1.0020 to the greenback, its weakest level since Aug. 6. Investors expect heightened volatility when U.S. markets reopen on Wednesday with the two-day closure creating pent-up demand. Some traders said they expect corporate and sovereign buying of the greenback ahead of the month-end, with investors unwinding long Canadian dollar positions. Canadian bond markets remained open though volumes were hit by the closure of the U.S. market. Prices drifted slightly lower, with the two-year bond off 2 Canadian cents to yield 1.096 percent, while the benchmark 10-year bond lost 9 Canadian cents to yield 1.807 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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