CANADA FX DEBT-C$ nears 3-week low vs U.S. dollar
* C$ ends at C$0.9918, or $1.0083, finishes week off 0.7 pct * C$ touches 9-month low against euro, 2-1/2 year high vs yen * Unexpectedly strong Canadian data fails to boost C$ * Bond prices rise across the curve By Claire Sibonney TORONTO, Jan 18 (Reuters) - Canada's currency slid to a near three-week low against a broadly stronger U.S. dollar on Friday after breaching a technical support level that pushed it out of its recent range. The move marked an exit from the range of less than one U.S. cent that it has held onto for the past couple weeks, which had been capped by the C$0.9885, or $1.0116, level. "There was more U.S.-dollar buying from the sort of real-money accounts right off the open (but) there was no obvious catalyst," said Shaun Osborne, chief currency strategist at TD Securities. The Canadian dollar was underperforming most of the other major currencies, except for the British pound and Norwegian krone. "It's really one-way flow in favor of the U.S. dollar right now ... it's the end of the week, it's bringing some position squaring with it. There is no influential data that's coming out of the market today in a meaningful way," said Jack Spitz, managing director of foreign exchange at National Bank Financial. The break prompted the currency to weaken as far as C$0.9947, or $1.0053. Spitz saw the next significant area of Canadian-dollar support around the 200-day moving average near C$0.9984, or $1.0016. On the way there, he said there is a "myriad of corporate orders that are offered anywhere in the C$0.99s." Investors largely ignored data on Friday that showed Canadian manufacturing sales rebounded sharply in November, more than compensating for the big slump in October. The Canadian dollar ended the North American session at C$0.9918 versus the greenback, or $1.0083, weaker than Thursday's North American session close at C$0.9857, or $1.0145. The currency finished the week down 0.7 percent. Global equities largely rose on Friday and did not appear to be positively correlated in their typical way with the Canadian dollar and other commodity currencies which underperformed. "The traditional correlations between strong equities and a weak dollar are breaking away in favor of better economics and ultimately better bid for currencies that are related to those economics," Spitz said. Still, TD's Osborne noted that in terms of cross market correlations, the Canadian dollar has a significantly closer link to stocks at around 80 percent, compared with crude, at less than 40 percent. He said the currency's correlation with the S&P 500 is approaching peak levels of 80 to 90 percent that were sustained through mid-2012. Trading in the euro and yen crosses were much more volatile on Friday. The Canadian dollar crept up to a 2-1/2 year intraday high against the yen at 91.35 yen, and a nine-month low against the euro at C$1.3244, or 75.51 euro cents. Canadian bond prices climbed across the curve, tracking U.S. Treasuries higher. Canada's two-year bond rose 4 Canadian cents to yield 1.178 percent, while the benchmark 10-year bond gained 32 Canadian cents to yield 1.915 percent.
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