* C$ firms slightly to C$1.0011 vs US$ or $0.9989
* U.S. fiscal cliff, Europe still in focus
* C$ expected to trade between parity and C$1.0030
* U.S. retail sales fall in October
By Solarina Ho
TORONTO, Nov 14 The Canadian dollar eked out
small gains against the U.S. currency on Wednesday but moves
were limited with many traders unwilling to make big bets due to
uncertainty over the U.S. fiscal cliff and aid payments for
"There are two really major issues that's really driving
market anxiety. One is the fiscal cliff and the other issue is
Europe," said Mazen Issa, macro strategist at TD Securities.
Investors awaited progress in approving an aid payment to
Greece, while a wave of strikes across Europe to protest against
spending cuts and tax hikes kept the focus on the region's debt
U.S. retail sales data for October, which offered an early
read on superstorm Sandy's impact on the economy, came in
slightly lower than the consensus forecast and added to the
cautious sentiment. Sandy's full impact will likely be felt in
the November data.
Issa said that markets were more concerned, however, with
how the United States will address the fiscal-cliff tax hikes
and spending cuts that are set to kick in early next year and
threaten to spur a recession.
"That's by and large the main theme that's been filtering
through the markets," Issa said.
"You're likely to see range-bound trading until you have
more clarity on the fiscal issue ... The day-to-day data is
taking a bit of a back seat to the fiscal issue."
At 9:31 a.m. (1431 GMT), the Canadian dollar was
trading at C$1.0011 versus the U.S. dollar, or $0.9989. This was
slightly firmer than Tuesday's North American finish of
C$1.0019, or $0.9981.
The currency is likely to trade between parity and C$1.0030
during the session, Issa said.
Prices for Canadian government debt generally retreated,
with the two-year bond falling 4.5 Canadian cents to
yield 1.101 percent. The benchmark 10-year bond shed
27.5 Canadian cents to yield 1.724 percent.