* C$ falls more than 2 U.S. cents
* Data suggests road to recovery still bumpy
* Bonds head higher as equities tumble
(Updates to midafternoon)
TORONTO, June 3 (Reuters) - Reduced risk appetite pulled
the Canadian dollar sharply lower against the U.S. currency on
Wednesday afternoon as equity markets and oil prices extended
The currency fell as low as C$1.1101 to the U.S. dollar, or
90.08 U.S. cents, in concert with it commodity-led cousins, the
New Zealand and Australian dollars, which suffered deeper
The U.S. dollar rose against a basket of major currencies
as a sharp fall in stocks trimmed risk appetite in the market
and rekindled safe-haven demand for the greenback.
"Some of the currencies that have done the best on the
upside on the increasing risk appetite, improvement in equity
markets, improvement in commodity markets, they're all finding
those positions reversed. Canada is in that pack," said Mark
Chandler, fixed income strategist, at RBC Capital Markets.
At 2:45 p.m. (1845 GMT), the currency was at C$1.1083 to
the U.S. dollar, or 90.23 U.S. cents, down from C$1.0810 to the
U.S. dollar, or 92.51 U.S. cents, at Tuesday's close.
Global stocks and oil fell hard after a batch of weak U.S.
economic data and an unexpected rise in crude inventories
suggested the road to recovery is still bumpy. [MKTS/GLOB]
Canadian bond prices higher across the curve on Wednesday,
partly benefiting from the debt's safe haven status in light of
declining equity markets.
Some economic reports released on Wednesday suggested the
economic recovery in the United States may have stalled, giving
bonds a small bump. [ID:nN03345672]
"It's a modest decline in yields, given what we've seen in
equities, said Chandler. "But to be fair, (the data) didn't add
a whole lot to the mix."
The benchmark two-year government bond rose 10 Canadian
cents to C$100.15 to yield 1.276 percent, while the 10-year
bond gained 25 Canadian cents to C$103.05 to yield 3.387
The 30-year bond rose 35 Canadian cents to C$116.95 to
yield 3.989 percent.
(Reporting by Ka Yan Ng; editing by Rob Wilson