* Canadian dollar at C$1.3346, or 74.93 U.S. cents
* Bond prices higher across a flatter maturity curve
TORONTO, March 15 (Reuters) - The Canadian dollar weakened
against its U.S. counterpart on Tuesday, hitting a nearly
one-week low as crude oil prices fell and investors braced for a
policy decision from the U.S. Federal Reserve on Wednesday.
Oil prices slid for a second day as concerns emerged that a
six-week rally may have fizzled after OPEC doused hopes for a
speedy erosion of a global overhang of unwanted crude. O/R
U.S. crude CLc1 prices were down 1.34 percent to $36.68 a
barrel.
Adding to headwinds for the risk-sensitive commodity related
currency, European shares tracked Asian shares lower after the
Bank of Japan painted a bleaker picture of the Japanese economy,
while U.S. stocks weakened as investors' focus turned to the
two-day Fed policy meeting beginning on Tuesday.
At 9:20 a.m. EST (1320 GMT), the Canadian dollar CAD=D4
was trading at C$1.3346 to the greenback, or 74.93 U.S. cents,
weaker than Monday's close of C$1.3267, or 75.37 U.S. cents.
The currency's strongest level of the session was C$1.3259,
while it touched its weakest since March 9 at C$1.3400.
Last week the loonie, as Canada's currency is colloquially
known, posted a four-month high at C$1.3168.
Domestic data was mixed. Sales of existing homes rose 0.8
percent in February from the prior month, a report from the
Canadian Real Estate Association showed. Data from PayNet showed
that commercial borrowing by small businesses dipped at the
start of 2016 as the economy continued to feel the pain from the
downturn in energy prices.
Canadian government bond prices rose across the maturity
curve, with the two-year CA2YT=RR price up 2 Canadian cents to
yield 0.568 percent and the benchmark 10-year CA10YT=RR rising
32 Canadian cents to yield 1.311 percent.
The curve flattened as the spread between the 2-year and
10-year yields narrowed by 2.3 basis points to 74.3 basis
points, indicating outperformance for longer-dated maturities.