Reuters: US Dollar Report: CANADA FX DEBT-C$ near six-month low as luster fades on rate outlook

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CANADA FX DEBT-C$ near six-month low as luster fades on rate outlook Jan 28th 2013, 14:01 Tweet Share this Email Print Related Topics Currencies » Bonds News » Bonds » Markets » Mon Jan 28, 2013 9:01am EST * C$ at C$1.0085 versus US$, or $0.9916 * Lost 1.5 pct last week after dovish Bank of Canada By Alastair Sharp TORONTO, Jan 28 (Reuters) - The Canadian dollar weakened further on Monday, bumping against a six-month low of C$1.0101 to the U.S. dollar, as investors shied away from the currency after the Bank of Canada last week softened its hawkish tilt on interest rates. The central bank on Wednesday said it would hold rates steady for longer than it had previously expected, with tepid inflation data later in the week backing up that stance. That pushed the Canadian currency to less than equal value with the greenback, and U.S. dollar strength to start the new week has kept the pressure on. At 8:26 a.m. (1326 GMT) the Canadian dollar was trading at C$1.0085 to the greenback, or $0.9916, compared with C$1.0065, or $0.9935, at Friday's North American close. It slipped 1.5 percent last week. "Ultimately, the implications of that (Bank of Canada) shift aren't as big as the market's talking about," said Greg Moore, foreign exchange strategist at TD Securities. But still, he said the short-term outlook pointed to further weakness as technical considerations trump factors such as movement in equity and commodity markets. The currency showed little reaction to robust durable goods data from the United States that signaled corporate investment plans remained intact. If the currency falls through the key C$1.01 level, it could easily hit C$1.02 and potentially even reach C$1.03 in coming weeks, Moore said. He saw decent resistance at C$0.9970. The price for a two-year bond was off 2 Canadian cents to yield 1.150 percent, while the benchmark 10-year bond fell 13 Canadian cents to yield 1.962 percent. Tweet this Link this Share this Digg this Email Reprints We welcome comments that advance the story through relevant opinion, anecdotes, links and data. If you see a comment that you believe is irrelevant or inappropriate, you can flag it to our editors by using the report abuse links. Views expressed in the comments do not represent those of Reuters. For more information on our comment policy, see http://blogs.reuters.com/fulldisclosure/2010/09/27/toward-a-more-thoughtful-conversation-on-stories/ Comments (0) Be the first to comment on reuters.com. Add yours using the box above.

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