CANADA FX DEBT-C$ little changed ahead of Fed

Wed Jun 18, 2014 10:31am EDT

* Canadian dollar at C$1.0866 or 92.03 U.S. cents
    * Bond prices higher across the maturity curve

    TORONTO, June 18 (Reuters) - The Canadian dollar was little
changed versus the U.S. currency on Wednesday as traders awaited
the results of a two-day meeting of Federal Reserve
policymakers, with expectations the U.S. central bank could take
a more hawkish tone than expected.
    Data showing Canadian wholesale prices rose twice as fast as
expected in April had no noticeable impact ahead of the release
of Fed economic and interest rate projections and the next step
in its bond-buying program. 
    "If the overall sense is that they're a bit more hawkish on
the outlook, that could see a bit of strengthening of the U.S.
dollar and in return a weakening of the Canadian dollar against
it," said Greg Moore, senior currency strategist at Royal Bank
of Canada in Toronto.
    At 10:20 a.m. (1420 GMT), the Canadian dollar was
at C$1.0866 to the U.S. dollar, or 92.03 U.S. cents, down a
touch from Tuesday's close of C$1.0864 or 92.05 U.S. cents.
    The currency has traded in a narrow band over the past week
but could accelerate its losses if it crosses resistance at
C$1.0880, or 91.91 U.S. cents, said Moore.
    "If we do get through there, there's the potential of a
larger move towards some of the (U.S. dollar) highs we saw a
week and a half ago in the mid C$1.09 area," he said.
    Looking past the Fed, Canadian market watchers will be
waiting for domestic inflation and retail sales data due on
Friday for any signs of price pressures that could prompt the
Bank of Canada to revise its own take on rates. Currently,
market players don't expect a rate hike until well into 2015.
    Canadian government bond prices were higher across the
maturity curve, with the two-year up 28 Canadian
cents to yield 1.098 percent and the benchmark 10-year
 up 25 Canadian cents to yield 2.287 percent.

 (Reporting by Cameron French; Editing by James Dalgleish)
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