CANADA FX DEBT-C$ ends flat in quiet trade, focus on Friday jobs data

Tue Jul 8, 2014 4:39pm EDT

* Canadian dollar unchanged at C$1.0677 or 93.66 U.S. cents
    * Investors await Canadian June jobs report on Friday
    * Bond prices higher across the maturity curve

 (Adds details of market action, closing figures)
    By Andrea Hopkins
    TORONTO, July 8 (Reuters) - The Canadian dollar was
unchanged against the greenback on Tuesday, stabilizing after
the previous session's sharp decline as a lack of domestic
economic data left the currency drifting.
    The loonie lost 0.3 percent on Monday after a
disappointingly weak report on purchasing activity in June, but
it is expected to sit tight until Canadian unemployment data for
June, due on Friday, provides some direction. 
    Investors are also trying to gauge whether the Bank of
Canada will stick to a neutral tone when it releases its
monetary policy statement next week or whether a recent strong
inflation report will force the central bank to alter its
message.
    "For the balance of the week, with not much data-wise except
for Canadian employment on Friday, nothing major in the States,
we will probably remain fairly range-bound until Friday
morning," said David Bradley, director of foreign exchange
trading at Scotiabank.
    Mark Chandler, head of Canadian fixed income and currency
strategy at Royal Bank of Canada in Toronto, said the loonie's
recent gains could be erased by a weak jobs report.
    "If we have a swing and a miss on our employment report, you
could have an accumulation of decent (economic) evidence in the
U.S. and our bank likely to be cautious, so that wouldn't be a
good prescription for the currency," Chandler said.
    The Canadian dollar ended the North American
session at C$1.0677 to the greenback, or 93.66 U.S. cents,
unchanged from Monday's close of C$1.0677, or 93.66 U.S. cents.
    Scotiabank's Bradley said he expects the currency to remain
in a range between C$1.0630 and C$1.0720 until the jobs report. 
    On average, analysts polled by Reuters expect Canadian
employers to have added 20,000 jobs in June after the 25,800
gained in May. The unemployment rate is expected to be unchanged
at 7.0 percent.
    Despite Monday's pullback, the loonie is still up about 2.5
percent since early June following a rally fueled by the firmer
inflation data, higher oil prices and a stronger outlook for
global economic growth.
    Canadian government bond prices were higher across the
maturity curve, with the two-year up 3.5 Canadian
cents to yield 1.116 percent and the benchmark 10-year
 up 47 Canadian cents to yield 2.249 percent.

 (Editing by Chizu Nomiyama; and Peter Galloway)
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A couple walks along the rough surf during sunset at Oahu's North Shore, December 26, 2013. REUTERS/Kevin Lamarque

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