* Canadian dollar rises 0.3% against the greenback * Loonie is on track to fall 1.2% for the week * Canadian industrial capacity use falls in the first quarter * Canadian bond yields rise across the curve TORONTO, June 12 (Reuters) - The Canadian dollar strengthened against its U.S. counterpart on Friday along with a rebound in stocks on Wall Street, but after a sharp decline the day before, the loonie was on course to end its weekly winning streak. U.S. stocks rallied a day after their biggest one-day dive in about three months on fears of a resurgence in coronavirus infections. Canada runs a current account deficit and is a major exporter of commodities, including oil, so the loonie tends to be sensitive to the global flow of trade and capital. U.S. crude oil futures fell 1.2% to $35.91 a barrel and were on track for their first weekly fall in seven as investors weighed the prospect of a second wave of infections hitting demand. The Canadian dollar was trading 0.3% higher at 1.3584 to the greenback, or 73.62 U.S. cents. The currency traded in a range of 1.3527 to 1.3666. The loonie was down 1.2% for the week, having climbed for each of the previous three weeks. On Wednesday, it reached its strongest level in more than three months at 1.3311. Canadian industries ran at 79.8% of capacity in the first quarter of 2020, down from an upwardly revised 81.4% in the fourth quarter, Statistics Canada said. Separate data from Canada's national statistics agency showed that producer prices, in a flash estimate, gained 1.2% in May from April, led by strong gains in meat prices as COVID-19 closed down packing plants. Canadian government bond yields were higher across the curve, with the 10-year up 2.1 basis points at 0.541%. Still, the 10-year yield has tumbled nearly 23 basis from last Friday's peak. (Reporting by Fergal Smith; editing by Jonathan Oatis)
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