CANADA FX DEBT-C$ strengthens to 6-week high as euro rallies

* C$ ends at C$1.0123 or 98.78 U.S. cents
    * Euro, U.S. dollar soar against yen after BOJ stimulus
    * C$ breaks through 50-day moving average

    By Andrea Hopkins
    TORONTO, April 4 (Reuters) - The Canadian dollar
strengthened to a six-week high against its U.S. counterpart on
Thursday, joining a rally in the euro against the greenback
following supportive comments from the European Central Bank.
    The Canadian currency, which often trades on global growth
prospects, erased early losses to trade stronger after ECB
President Mario Draghi said the bank stood ready to act if
growth continues to languish. 
    "As euro strengthened, CAD strengthened, suggesting it was
very much about what was transpiring globally, particularly in
Japan as well as the ECB," said Camilla Sutton, chief currency
strategist at Scotiabank.
    "It highlights that relative central bank policies are very
important for currencies."
    The Bank of Japan had earlier unleashed the world's most
intense burst of monetary stimulus, promising to inject about
$1.4 trillion into the economy in less than two years, a radical
gamble that sent the yen reeling. 
    The Canadian currency climbed as high as C$1.0103 to the
U.S. dollar on Thursday, or 98.98 U.S. cents, its strongest
showing since Feb. 19.
    The Canadian dollar ended the North American
session at C$1.0123 to the U.S. dollar, or 98.78 U.S. cents, up
from Wednesday's North American session close at C$1.0145 to the
greenback, or 98.57 U.S. cents.
    "It's been a very good day for Canada in the sense that we
made a run for the C$1.01 (level), we've broken out of our
range, we've broken through the 50-day (moving average) ... all
of that is positive for CAD," Sutton said.
    Against the sinking yen, the Canadian dollar hit its
strongest level since the height of the financial crisis in late
    The comments from the ECB head reversed early Canadian
dollar weakness on data showing that the number of Americans
filing new claims for unemployment benefits hit a four-month
high last week, a potential sign the U.S. labor market recovery
lost steam in March. 
    That, combined with weaker-than-expected ADP private-sector
employment data on Wednesday has analysts ratcheting back
expectations for the closely watched monthly U.S. payrolls and
unemployment report due out on Friday. Canada's monthly job
creation and unemployment rate data are also due out on Friday.
    Economists polled by Reuters are expecting 8,500 new jobs in
Canada for the month of March, a moderation from the unexpected
50,700 surge in February. U.S. nonfarm payrolls are expected to
have risen 200,000 in March. 
    The price of Canadian government debt was higher across the
curve. The two-year bond was up 1 Canadian cent to
yield 0.990 percent while the benchmark 10-year bond 
rose 38 Canadian cents to yield 1.786 percent.