CANADA FX DEBT-C$ rallies on vow that ECB will act

* C$ at C$1.0074 vs US$, or 99.27 U.S. cents
    * Bonds fall in price across the curve
    * ECB head says "whatever it takes to preserve the euro"

    By Claire Sibonney
    TORONTO, July 26 (Reuters) - The Canadian dollar climbed to
a near one-week high on Thursday, tracking the euro and other
risk assets higher after European Central Bank President Mario
Draghi pledged to do whatever was necessary to protect the euro
zone from collapse.
    "Within our mandate, the ECB is ready to do whatever it
takes to preserve the euro. And believe me, it will be enough,"
he told an investment conference in London.
    Draghi's comments were his boldest to date and helped
reassure a market waiting for the ECB to act on lowering 
unreasonably high government borrowing costs, some of which have
spiraled to unsustainable levels. 
    "The broad theme, it's not something that's confined to the
Canadian dollar obviously, is that risk is clearly back on this
morning and this is all really to do with Europe," said Chris
Applin, senior dealer at Canadian Forex in London.
    At 8:05 a.m. (1205 GMT), the Canadian dollar was at
C$1.0074 versus the U.S. dollar, or 99.27 U.S. cents. The
currency was at its firmest level since July 20 and decidedly
higher than Wednesday's North American session finish at
C$1.0152 against the greenback, or 98.50 U.S. cents. 
    Applin pegged the rest of the day's range between
C$1.0020-C$1.0100, but cautioned that markets are still very
    "I just think that this move is maybe premature given
obviously nothing fundamentally changed here; Draghi has just
come in and just done some jawboning basically," he said.
    "It's not like we're any further down the line on euro bonds
or even a kind of banking supervisory body ... but I think
markets will look for the slightest hint that the ECB are
willing to do a little bit more."
    Canadian bond prices retreated across the curve in the
risk-on move with the two-year bond down 6 Canadian
cents to yield 0.990 percent and the benchmark 10-year bond
 31 Canadian cents lower to yield 1.626 percent.