CANADA FX DEBT-C$ weaker as trade picture darkens, euro jumps

* Canadian dollar at C$1.2472, or 80.18 U.S. cents
    * Bond prices lower across the maturity curve

    TORONTO, June 3 (Reuters) - The Canadian dollar weakened
against its U.S. counterpart on Wednesday, as the major trade
partners produced divergent data, and hit its weakest level in
three months versus the euro.
    Canada posted a near-record trade deficit in April, with
both imports and exports falling, while the U.S. trade gap
shrunk by its largest amount since early 2009.
    At 9:23 a.m. ET (1323 GMT), the Canadian dollar was
trading at C$1.2472 to the greenback, or 80.18 U.S. cents,
weaker than the Bank of Canada's official close of C$1.2408, or
80.59 U.S. cents, on Tuesday.
    Currency markets were dominated by euro-centric trading
however, as the common currency jumped anew after the European
Central Bank raised its inflation target. 
    "I'm not concerned that the Canadian dollar is going to
collapse, and I don't have any belief that the loonie's going to
soar here," said Brad Schruder, director of foreign exchange
sales at BMO Capital Markets. "It's really going to be about the
next major pieces of data."
    That next catalyst may come on Friday, when both Canada and
the United States report employment data for May.
    "Many in the market that think we're just one really strong
job non-farm print away from certainty around July or at the
latest September for a (U.S.) rate hike," Schruder said.
    * U.S. crude prices were down 1.1 percent at $60.59,
while Brent crude lost 1 percent to $64.81. 
    * The Canadian dollar should trade between C$1.2450 and
C$1.2550 going into Friday's job numbers, Schruder said. 
    * Canadian government bond prices were lower across the
maturity curve, with the two-year down half a
Canadian cent to yield 0.596 percent and the benchmark 10-year
 falling 41 Canadian cents to yield 1.754 percent.
    * The Canada-U.S. two-year bond spread was -7.7 basis
points, while the 10-year spread was -56.8 basis points.

 (Reporting by Alastair Sharp; Editing by Lisa Von Ahn)