CANADA FX DEBT-C$ strengthens to 1-month high after positive U.S. data

Tue Mar 26, 2013 9:50am EDT

* C$ at C$1.0175 vs US$, or 98.28 U.S. cents
    * U.S. single-family home prices rise in January
    * Demand for U.S. durable goods surges 5.7 percent
    * Canadian bond prices fall across curve

    By Solarina Ho
    TORONTO, March 26 (Reuters) - The Canadian dollar was
strengthened to a one-month high versus its U.S. counterpart on
Tuesday, helped by a better-than-expected rise in U.S. durable
goods orders in February and U.S. housing data that showed
recovery remained on track.
    U.S. single-family home prices rose in January, starting the
year with the biggest annual increase in six-and-a-half years in
a fresh sign the housing market recovery remains on track,
according to the closely watched S&P/Case Shiller composite
index. 
    Demand for long-lasting U.S. manufactured goods, which range
from toasters to aircraft, surged 5.7 percent in February and
reversed January's 3.8 percent plunge. This suggested factory
activity continued to expand at a moderate pace. 
    A stronger U.S. economy often benefits the Canadian dollar,
because it is the largest single market for Canadian exports.
    "The headline of durable goods orders is also somewhat
constructive for risk sentiment and maybe by association has
helped to provide the Canadian dollar with a little bit more ...
positive momentum to start the day," said David Tulk, chief
Canada macro strategist at TD Securities.
    At 9:22 a.m. (1322 GMT), the currency was trading
at C$1.0175 against the U.S. dollar, or 98.28 U.S. cents,
stronger than Monday's North American close at C$1.0212, or
97.92 U.S. cents. It touched C$1.0166, or 98.37 U.S. cents, the
currency's strongest level in more than a month.
    The Canadian dollar was outperforming all major currencies,
and was touching it's strongest level against the euro
 in nearly two and a half months.
    Concerns over Cyprus and the region's debt woes continued to
pressure the euro, which also hovered near four-month lows
against the U.S. dollar. 
    Canadian government bond prices were lower across the curve,
with the two-year bond off 1.5 Canadian cents to
yield 1.007 percent. The benchmark 10-year bond fell
15 Canadian cents to yield 1.830 percent.
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