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CANADA FX DEBT-C$ edges higher as firm domestic data offsets lower oil prices

Published 2016-07-21, 10:09 a/m
© Reuters.  CANADA FX DEBT-C$ edges higher as firm domestic data offsets lower oil prices
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* Canadian dollar at C$1.3040, or 76.69 U.S. cents

* Bond prices lower across the maturity curve

* 10-year yield touches its highest since June 24 at 1.174 percent

TORONTO, July 21 (Reuters) - The Canadian dollar edged higher against its U.S. counterpart on Thursday as stronger-than-expected domestic wholesale trade offset lower oil prices.

The value of Canadian wholesale trade surged by 1.8 percent in May from April, led by the motor vehicle and auto parts subsector, Statistics Canada said. In volume terms sales rose by 1.5 percent. U.S. dollar .DXY pared some recent gains against a basket of major currencies as Bank of Japan chief Haruhiko Kuroda said the bank saw no need to stimulate the economy with "helicopter money," and the European Central Bank held off with any immediate further easing of monetary policy. slippage in crude oil prices restrained gains for Canada's commodity-linked currency. U.S. crude CLc1 prices were down 0.81 percent to $45.38 a barrel after a rise in U.S. gasoline inventories helped push U.S. oil stocks to a record high, reinforcing worries of a global oversupply. O/R

At 9:46 a.m. EDT (1346 GMT), the Canadian dollar CAD=D4 was trading at C$1.3040 to the greenback, or 76.69 U.S. cents, slightly stronger than Wednesday's close of C$1.3055, or 76.60 U.S. cents.

The currency's strongest level of the session was C$1.3023, while its weakest was C$1.3077. On Wednesday, the loonie touched its weakest intraday level in eight days at C$1.3097.

A long-awaited child benefit monthly payment from the government that kicked in on Wednesday for Canadian families is expected to provide a small but much-needed economic boost, even if cash-strapped consumers use some of the extra money to pay down debt. government bond prices were lower across a steeper maturity curve in sympathy with U.S. Treasuries.

The two-year CA2YT=RR price fell 3 Canadian cents to yield 0.62 percent and the benchmark 10-year CA10YT=RR declined 30 Canadian cents to yield 1.155 percent. The 10-year yield touched its highest since June 24 at 1.174 percent.

The curve steepened as the spread between the 2-year and 10-year yields widened by 1.5 basis points to 53.5 basis points, indicating underperformance for longer-dated maturities.

Canadian retail sales data for May and inflation data for June are due on Friday.

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