Reuters: US Dollar Report: CANADA FX DEBT-Commodities, euro zone data nudge C$ higher

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CANADA FX DEBT-Commodities, euro zone data nudge C$ higher Aug 14th 2013, 20:47 Wed Aug 14, 2013 4:47pm EDT * C$ at C$1.0328 to the greenback, or 96.82 U.S. cents * German and French economies grew faster than expected * Little impetus in market until domestic data on Friday TORONTO, Aug 14 (Reuters) - The Canadian dollar gained marginally against the U.S. currency in slow summer trading on Wednesday, supported by higher commodity prices and encouraging economic data from Europe. Data showed the euro zone emerged in the second quarter from a 1-1/2-year recession, the longest since the euro zone's inception. The German and French economies, the region's largest, grew faster than expected, primarily driven by renewed business and consumer spending. "I really see two things underpinning the Canadian dollar. One is commodity strength," said Adam Button, currency analyst at ForexLive in Montreal. Commodity prices were broadly higher on Wednesday. "Two, stronger GDP in Europe points to better global growth and that's certainly something that could underpin the Canadian dollar." The Canadian dollar saw little activity during the North American session and finished at C$1.0328 to the greenback, or 96.82 U.S. cents. This compared with C$1.0343, or 96.68 U.S. cents, at Tuesday's North American close. The loonie, as Canada's currency is colloquially known, has drifted in recent weeks, pulled mostly by changing market views on when the U.S. Federal Reserve may withdraw some of its stimulus. The next opportunity for domestic news to influence the currency comes on Friday, when data on manufacturing sales for June is due to be released. "Domestic data do matter to a degree, obviously we're starting to get the early indications on Q3 growth now, including the manufacturing data fitting into that jigsaw," said Adam Cole, global head of foreign exchange strategy at Royal Bank of Canada. The loonie is broadly expected to trade between C$1.0250 and C$1.0450 this week, in keeping with its range of the past month. Prices for Canadian government debt were mixed, with the two-year bond up half a Canadian cent to yield 1.202 percent and the benchmark 10-year bond falling 5 Canadian cents to yield 2.631 percent. Link this Share this Digg this Email Reprints

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