Canadian dollar turns lower as risk appetite fades

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(Reuters)

By Frank Pingue

TORONTO (Reuters) - Canada's dollar was slightly lower versus the U.S. currency on Friday given a general lack of appetite for riskier assets that also has North American equities poised for a soft open.

The Canadian currency fell as low as C$1.0703 to the U.S. dollar, or 93.43 U.S. cents, overnight. It recovered slightly but remained lower on the day as equities were seen giving back some of the gains recorded on Thursday.

"Today we are basically reacting with just about everybody else to the general market sentiment," said Firas Askari, head of foreign exchange trading at BMO Capital Markets. "And right now it looks like equities are going to open up slightly down based off futures so you saw the Canadian dollar sell off."

U.S. stock index futures dipped on Friday, a day after the market logging its best percentage gain in three months, as investors await data that will shed light on consumer sentiment.

Askari said Canadian GDP data for August, due out at 8:30 a.m. (1230 GMT), would not have much currency impact since it is an August number. The report is expected to show Canada's economy grew 0.1 percent in August after stagnating in July.

At 7:30 a.m. (1130 GMT), the Canadian unit was at C$1.0688 to the U.S. dollar, or 93.56 U.S. cents, down from C$1.0670 to the U.S. dollar, or 93.72 U.S. cents, at Thursday's close.

Domestic bond prices were higher across the curve alongside a similar move in the bigger U.S. Treasury market, recovering some of the slide recorded in the previous session.

(Editing by Chizu Nomiyama)