WRAPUP 1-Purchasing data tips cooler Canadian economy

* Canada purchasing activity expands more slowly in June

* Small business confidence eases in June

* Canadian optimism muted in second quarter-survey

By Ka Yan Ng

TORONTO, July 7 (Reuters) - Canadian purchasing activity grew at a slower than expected pace in June from May, while confidence indicators out on Wednesday suggested a slightly less upbeat mood, adding to evidence that the country's economic recovery is softening.

The Ivey Purchasing Managers Index eased to 58.9 in June from 62.7 in May, rather than rising to the quicker pace of expansion at 64.0 that had been forecast by analysts.

A separate business barometer index showed confidence had declined a touch in June, while a poll showed Canadians were positive on the economy but less so compared to the previous quarter.

The reports add to a string of statistics that suggest the economy has taken a step back from its stunning pace of growth in the first quarter.

The data did not faze markets on Wednesday with the Canadian dollar gaining steadily to its firmest levels of the session, while Toronto's main stock index were bolstered partly by a bounce in oil prices and a deal by Total SA (TOTF.PA) to buy UTS Energy Corp UTS.TO.

The euphoria in Canada over the country's strong recovery has given way to a sinking realization that it was too good to last, with a faltering U.S. economy now seen dragging on growth. [ID:nN07126492]

Confidence among small and medium-sized Canadian businesses dipped in June, according to a business barometer index released by the Canadian Federation of Independent Business (CFIB).

The index slipped to 66.4 last month, down about a point from May's 67.3 level, and came in at the lower end of the average over the last 10 months, CFIB said.

The group said the slip suggests the economy is growing at a modest 2.5 percent clip, while anticipated interest rate increases mean "business owners are not overextending themselves," said CFIB chief economist Ted Mallett.

A separate quarterly poll showed Canadians were less optimistic than three months ago about the economy and were still anxious about their personal finances.

The telephone survey of 1,008 Canadians by Nanos indicated that 40.9 percent felt there would be no change in the economy over the next six months, up 2.8 percentage points from the previous quarter. But 39.4 percent of Canadians felt the economy would become stronger, down 4.5 percentage points.

On personal finances, Canadians were more likely to say they are worse than better off compared to a year ago.

But Canadians were positive on the value of real estate, with 43.3 percent saying they expected prices in their neighborhood would hold their value, nearly unchanged from the previous quarter.

Real estate broker Royal LePage said on Wednesday said it expects year over year home price appreciation to average 6.8 percent. [ID:nN07226803]

($1=$1.05 Canadian) (Editing by Jeffrey Hodgson)