November 22, 2018 / 3:19 PM / 18 days ago

CANADA FX DEBT-C$ firms as Canadian government weighs measure to move oil

    * Canadian dollar rises 0.1 percent against the greenback
    * Price of U.S. oil falls 0.3 percent
    * Canadian bond prices dip across the yield curve

    TORONTO, Nov 22 (Reuters) - The Canadian dollar edged higher
against its U.S. counterpart on Thursday as the greenback
broadly fell and Canada's government weighed a proposal which
could help soften the blow from price discounts on heavy crude
generated by pipeline congestion.
    At 9:57 a.m. (1457 GMT), the Canadian dollar          was
0.1 percent higher at 1.3225 to the greenback, or 75.61 U.S.
cents, in holiday impacted trading with U.S. markets shut for 
Thanksgiving.
    The loonie, which touched on Tuesday its weakest in nearly
five months at 1.3318, traded in a range of 1.3214 to 1.3245.
    Canada's federal government is considering a proposal from
its main oil producing province of Alberta to share the cost of
buying rail cars to move oil stuck in the region because of a
lack of pipeline capacity, two sources with direct knowledge of
the matter said.             
    Western Canada Select (WCS) oil traded last month as much as
$52.50 per barrel below West Texas Intermediate light oil, its
biggest differential in data going back to 2010, according to
Shorcan Energy Brokers.
    Recent weakening in the price of U.S. oil has added to
headwinds for Canada's oil patch. On Thursday, oil prices fell
after U.S. crude inventories swelled to their highest level
since December, adding to concerns about a global glut but OPEC
talk of an output reduction limited losses.             
    U.S. crude        prices were down 0.3 percent at $54.47 a
barrel, while the U.S. dollar        fell against a basket of
major currencies after Britain and the European Union agreed in
principle to a text setting out their future relationship before
a summit on Sunday, boosting the euro and sterling.             
    Canada will allow businesses to write off additional capital
investments to make them more competitive at a time when the
United States is aggressively cutting taxes, Finance Minister
Bill Morneau said on Wednesday.             
    Canadian government bond prices were lower across the yield
curve, with the two-year            down 1.5 Canadian cents to
yield 2.242 percent and the 10-year             falling 8
Canadian cents to yield 2.371 percent.
    Canada's inflation report for October and September retail
sales data are due on Friday.

 (Reporting by Fergal Smith
Editing by Susan Thomas)
  
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