Today’s top stories from Report on Business :

International investors eye Canada

Canada’s economic and fiscal standing are luring international investors. Not only did the Canadian dollar CAD/USD-I shoot higher again today, before retreating somewhat, but the finance department also announced plans for an offering of euro-denominated 10-year bonds, its first in the European common currency since early 1999. Ottawa’s move follows a $30-billion (U.S.) global bond issue last September. Rising commodities prices and projections that Canada will lead economic growth among the G7 this year are boosting Canada’s fortunes. “The Canadian dollar has now become the latest fashion frenzy,” said David Watt, senior currency strategist at RBC Dominion Securities in a morning note, adding global investors have been boosting their long positions in the currency recently.

On the bond issue, Scotia Capital noted Ottawa’s clear need for deficit financing and “the word’s love affair with Canada versus crowding out the domestic issuance space.”

Scotia also cited the move as “another anecdote that confirms the broader issues at play in the country’s overall balance of payments. Twin current account and fiscal deficits have abruptly turned away from twin surpluses of yesteryear, such that the downward decline in net foreign debt as a share of GDP since the mid-1990s has bottomed and is turning toward increasing reliance upon foreign capital to fund the Canadian economy at the margin of its activities.” Read the story

Iceland’s troubles deepen

Iceland’s recovery and hopes for a fast entry to the EU are now at risk after its president, Olafur Grimsson, refused today to sign a bill that would repay Britain and the Netherlands $5-billion (U.S.) for the money lost by British and Dutch savers when the Icesave bank collapsed in 2008. The deal was passed by Iceland’s parliament but was not popular among the electorate, and will now be put to a referendum. Observers say the decision by the president, whose position is largely symbolic, could have widespread ramifications, hurting its hopes for international aid. The British and Dutch governments are also now likely to stall Iceland’s entry into the EU. Read the story

Google unveils smart phone

Google Inc. GOOG-Q product manager Erick Tseng calls the company’s first smart phone a “mini-computer, sitting in your pocket.” His comments came as the Internet search giant today unveiled the Nexus One, which will run on the company’s own Android operating system and, analysts said, is designed to stake out its turf in the growing mobile search market. Google also today opened a Web store that will sell the units directly to consumers. Read the story

Kraft sweetens Cadbury bid

The fight for Cadbury PLC took several twists today: Kraft Foods Inc. KFT-N sweetened its $16.5-billion (U.S.) hostile bid for the British candy maker while Nestlé SA said it had no plans for an offer, dimming hopes for a bidding war. Nestlé instead handed Kraft cash needed to boost the cash portion of its offer by buying its North American pizza business for $3.7-billion. But just as it appeared Kraft was moving ever closer to winning Cadbury, Warren Buffett’s Berkshire Hathaway Inc. BRK.B-N , a major Kraft shareholder, warned the U.S. food giant it opposed its plan to issue new shares in a deal. Mr. Buffett had already warned Kraft about using its undervalued stock as currency. Kraft said it takes Mr. Buffett’s views seriously. Read the story

Bombardier studies Mesa’s Chapter 11 filing

Bombardier Inc. BBD.B-T is assessing the impact of Mesa Air Group Inc.’s filing for bankruptcy protection. Mesa, which with 130 aircraft flys regional routes for major U.S. airlines, owes $133-million to Bombardier, its second-biggest creditor, which has delivered 90 of 100 regional jets ordered. “We’re working with Mesa to better position itself in this climate,” Bombardier Aerospace spokesman John Arnone said. “It’s in everyone’s best interest to see Mesa come out of this better positioned.”

National Bank Financial analyst David Newman said the remaining 10 CRJs are now at risk of being cancelled but that “the CRJ is a lower-margin product and we believe this termination should not have a material near-term impact on production or earnings, other than reduced overhead absorption.” Read the story

Suncor sells assets to Noble

Suncor Energy Inc. SU-T is selling some major U.S. assets to Nobel Energy Inc. NBL-N for $494-million (U.S.). The deal involves virtually all of the Rockies upstream assets of Petro-Canada Resources (USA) Inc. and Suncor Energy (Natural Gas) America Inc. Suncor acquired Petro-Canada last year.

U.S. pending home sales fall

Pending home sales in the United States fell sharply in November, another setback for the embattled real estate industry where the financial crisis began. The National Association of Realtors said today its index fell 16 per cent from October, far larger than what observers had expected. A federal incentive of up to $8,000 for first-time buyers had been set to expire at the end of November, but the program was extended and broadened.

German unemployment dips

Europe continues to divide along economic lines. Germany, Europe’s biggest economy, reported today that unemployment fell in December for the sixth month in a row, by 3,000, although the jobless rate remained at 8.1 per cent. In Spain, however, unemployment rose 1.4 per cent, it’s jobless rate nearing 20 per cent. Germany has bolstered its labour market with subsidies for shifting employees to part-time jobs rather than laying them off.

From today’s Report on Business

World’s factories humming again

Built out of opulence, named for a bailout

Holiday spending binge boosts debt levels