* C$ ends at C$0.9949 versus US$, or $1.0051
* C$ slides on comment by Bank of Canada head
* Global growth worries add to C$ weakness
* Bond prices climb, outperform Treasuries
By Claire Sibonney
TORONTO, Oct 24 (Reuters) - The Canadian dollar weakened
against its U.S. counterpart on Wednesday after the head of the
Bank of Canada said the case for raising interest rates was
"less imminent."
The currency hit a session low after the central bank's
governor, Mark Carney, made the comment in a news conference,
citing weak third-quarter growth and more slack in the economy.
"When Carney said that the case for raising rates is less
imminent, that jolted the market," said David Watt, chief
economist for HSBC Canada.
Overnight index swaps, which trade based on expectations for
the central bank's key policy rate, showed that after the report
and Carney's comments traders scaled back bets on a rate hike in
late 2013.
Earlier in the day, Canada's dollar had hit its strongest
level since last Friday as traders cheered the bank's decision
on Tuesday to retain hawkish language in its rate-setting
statement.
The bank's tightening stance contrasts sharply with the
monetary easing on offer in the United States and most other
developed economies.
But Carney's comment qualifying the central bank's view
quickly knocked the currency lower.
"We've taken back some of the impact we had yesterday," said
Mark Chandler, head of Canadian fixed income and currency
strategy at Royal Bank of Canada.
"It was basically off of comments which the market took to
heart today but really wasn't much different from what the bank
had talked about before, that rate hikes weren't imminent," he
said.
C$ RALLY UNWINDS
A Reuters poll on Wednesday showed most of Canada's primary
dealers still expect the Bank of Canada to hold off raising
interest rate until late next year or 2014.
The Canadian dollar ended the North American
session at C$0.9949 to the greenback, or $1.0051, compared with
C$0.9927, or $1.0074, at Tuesday's North American close. The
currency at one point hit a session low of C$0.9959, or $1.0041.
The currency underperformed most other majors.
Support for the Canadian dollar is still seen near U.S.
dollar parity, around the 100- and 200-day moving averages.
The Canadian dollar's weakness was compounded on signs that
the euro zone is heading toward a deeper recession than
previously feared. This contributed to a broader rise in the
safe-haven greenback against most major currencies. [MKTS/GLOB}
Short-term Canadian government debt prices received a boost
from Carney's comments, outperforming U.S. Treasuries.
The two-year bond rose 5 Canadian cents to yield
1.118 percent, while the benchmark 10-year bond
gained 4 Canadian cents to yield 1.847 percent.