Canadian dollar fell to a two-week high against the dollar

Canadian dollar fell to a two-week high against the dollar as the debt crisis of Europe concern extended damped investor appetite "for risk and U.S. Treasury yields near a seven-month highs currency U.S. more attractive.
The Canadian currency lost for the second straight week against its U.S. counterpart, which rose today against the most important partners such as the euro and Australian dollar, Ireland's credit rating was cut five levels. Canadian Imperial Bank of Commerce suggested politicians consider selling Canadian dollars to limit long-term gains in the currency.
"The problems in Ireland with the cut this morning, have provided the stimulus for a move to risk aversion and buying U.S. dollars to Treasuries as a safe haven," said Darren Richardson, merchant Toronto corporate senior CanadianForex Ltd., an online foreign exchange dealer. "Canada, Australia and the euro have been sampled."
Canadian currency, nicknamed the Canadian dollar slipped 0.8 percent to C $ 1.0140 per U.S. dollar at 5 pm in Toronto, from $ 1.0061 yesterday. It touched C $ 1.0147, its lowest level since December 2. The currency, which fell 0.5 percent in the week, came to C $ 1.0001 on 15 December, the strongest level since trading at parity with the dollar on 11 November. One Canadian dollar buys 98.62 U.S. cents.
The Canadian currency "was found forward selling well in area C $ 1.01," wrote Shaun Osborne, chief currency strategist based in Toronto at the TD Toronto-Dominion Bank's securities unit in an e-mail.
Profit for the year
The Canadian dollar gained 4.4 percent last year to an extent of 10 currencies of developed countries. The Australian dollar rose 11 percent, while the dollar fell 1.8 percent and the euro fell 10 percent.
Bank of Canada Governor Mark Carney may want to consider selling Canadian dollars as an option for moderate gains in the currency driven by purchases of other central banks, Avery Shenfeld, CIBC's chief economist, wrote in a report released today.
The Canadian dollar's strength undermines the ability of Carney to raise interest rates to curb rising levels of household debt, Shenfeld said in the report. Further gains in the currency may slow growth, he said.
"It is a weapon has not yet been touched: fighting fire with fire," wrote Shenfeld. "Canada could coincide with the central bank's foreign intervention in favor of our intervention currency compensation, the sale of an equivalent volume of crazy."
The call for the Bank of Canada to intervene "may have some impact in thin markets," wrote David Watt, senior currency strategist at Toronto's Royal Bank of Canada RBC Capital Markets said in an e-mail.
"More modest '
"However, the movements of millions of Canadian dollars have been rather modest in recent times, and its performance in the last 24 hours is consistent with the Australian dollar and New Zealand dollar, so it might just be that we overnight to catch up "Watt wrote.
Canadian government bonds rose, pushing yields on benchmark notes 10 years by eight basis points, or 0.08 percentage point to 3.19 percent. They touched 3.16 percent, the lowest since Dec. 7. The price of the 3.5 percent security due June 2020 rose 65 cents to C $ 102.54.
The action and crude oil, the main export product of Canada, varied. The Dow Jones Industrial Average was little changed after falling 0.4 percent. Crude for January delivery fell as much as 0.8 percent to $ 87.01 a barrel in New York before trading at $ 88.02. $ 86.83 touched on 15 December, the lowest since 02 December.
Seven months
Yields of 10-year bond traded at 3.33 percent, after reaching 3.56 percent yesterday, the highest since May 1913. It closed at 2.80 percent on 30 November.
Currencies of countries linked to the growth as Canada, New Zealand and Australia fell against the dollar today on concern a summit of European Union do not produce enough to keep the problems of sovereign debt spreads in the region. While the EU leaders agreed to amend the treaties of the block to create a permanent mechanism of the debt crisis in 2013, he struggled to overcome divisions on immediate measures to stabilize the bond market.
Moody's Investors Service downgraded the credit rating to Baa1 Ireland Aa2 today after the government was forced to seek outside help last month, staggered by losses in the country's banking system. The new rating is just three levels above non-investment grade.