CANADA FX DEBT-C$ little changed as U.S. dollar in focus

* C$ at C$1.0172 vs US$, or 98.31 U.S. cents
    * Euro zone economy contracts; U.S. economic recovery on
    * Manufacturing sales sag in March; home sales rise in April
    * U.S. and Canadian CPI in focus

    By Solarina Ho
    TORONTO, May 15 (Reuters) - The Canadian dollar held steady
against the U.S. dollar and outperformed against most other
currencies on a slew of mixed economic data.
    Canadian manufacturing sales sagged in March following an
unexpected surge in February, reverting to a trend of lackluster
performance more in line with modest economic growth, according
to Statistics Canada data. 
    Meanwhile, Canadian home sales rose in April, the second
straight monthly gain, as spring home buying bolstered hopes
Canada's housing market will manage a soft landing.
    Investors took a more cautious look at the global economy
after European data which showed the euro zone economy
contracted more than expected in the first quarter and saw
France slide back into recession.
    South of the border, a decent showing from the U.S. economy
has helped its currency make solid gains against key rivals and
underpinned expectations the Federal Reserve may wind down its
asset-purchasing program by the end of the year.
    "It's more or a less it's a wash. It's a broader-based
(U.S.) dollar appetite at the moment," said Darcy Browne,
Managing Director, Capital Markets Trading at CIBC.
    "I think most people have the mindset now that you should
buy on (U.S.) dollar dips. As it pertains to USD/CAD, Canada is
still very much range bound."
    The loonie, as Canada's currency is colloquially known,
finished trading at C$1.0172 to the greenback, or 98.31 U.S.
cents, little changed from Tuesday's North American close at
C$1.0170, or 98.33 U.S. cents. Earlier in the session, the
Canadian dollar had weakened to C$1.0220.
    "To be honest, I'd characterize the move today more as
dollar strength than CAD weakness," said Adam Cole, the global
head of currency strategy at Royal Bank of Canada. "It's a
parallel move against most of the majors, rather than being
anything specific to CAD."
    Inflation data from the United States on Thursday and Canada
on Friday are the next main focus for the market. The Bank of
Canada has ratcheted down growth expectations in recent months
and economists polled by Reuters are expecting no growth for the
month of April. 
    "If there was to be a surprise, it would be toward better
growth than weaker at this point. Anything weaker would probably
push us back up to C$1.0250, said CIBC's Browne.
    Prices for Canadian government bonds rose across the curve,
with the two-year bond up 2.1 Canadian cent to yield
1.028 percent and the benchmark 10-year bond rising
32 Canadian cents to yield 1.922 percent.