CANADA FX DEBT-Canadian dollar hits 4-week low as oil tumbles

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    * Canadian dollar weakens 0.4% against the greenback
    * Touches its weakest since Oct. 12 at 1.2497
    * Price of U.S. settles 3.3% lower
    * Canadian bond yields rise across the curve

    By Fergal Smith
    TORONTO, Nov 10 (Businesshala) - The Canadian dollar weakened on
Wednesday to its lowest level in nearly a month against its U.S.
counterpart, as oil prices fell and accelerating U.S. inflation
data added to pressure on the Federal Reserve to hike interest
rates sooner than expected.
    The loonie        was trading 0.4% lower at 1.2491 to the
greenback, or 80.06 U.S. cents, after touching its weakest
intraday level since Oct. 12 at 1.2497.
    "The combination of weaker oil and higher inflation figures
all lean towards a higher USD and we are seeing that pretty much
across the board," said Darren Richardson, chief operating
officer at Richardson International Currency Exchange Inc.
    The price of oil, one of Canada's major exports, settled
3.3% lower at $81.34 a barrel after U.S. President Joe Biden
said his administration was looking for ways to reduce energy
costs amid a broader increase in inflation.             
    The U.S. dollar        jumped against a basket of major
currencies after U.S. consumer prices surged to their highest
rate since 1990. Investors worry that underestimating price
increases could prove to be a costly policy mistake by the Fed.
            
    Canada's inflation report for October is due next Wednesday,
which could offer clues on the Bank of Canada policy outlook.
    The central bank should not change its three-decade-old
monetary policy framework, which is flexible enough to deal with
bouts of price increases, particularly as tweaking it could
trigger more public anxiety over hot inflation, analysts say.
            
    Canadian government bond yields were higher across the
curve, tracking the move in U.S. Treasuries. The 10-year
            rose 10.1 basis points to 1.697%, moving back in
reach of the 2-1/2-year peak it touched last week at 1.766%.   

 (Reporting by Fergal Smith; Editing by Edmund Blair and Peter
Cooney)
  
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