September 24, 2018 / 2:26 PM / in a month

CANADA FX DEBT-C$ holds on to gains as wholesale trade beats estimates

    * Canadian dollar at 1.2915 to the greenback, or 77.43 U.S.
cents
    * Price of U.S. oil rises 1.9 percent
    * Canadian bond prices fall across the yield curve
    * 10-year yield touches a 4-month high at 2.459 percent

    TORONTO, Sept 24 (Reuters) - The Canadian dollar was little
changed against its U.S. counterpart on Monday, holding onto
recent gains, as oil prices rose and the greenback fell broadly,
while domestic data showed a stronger-than-expected increase in
wholesale trade.
    Canadian wholesale trade rose 1.5 percent in July from June,
a bigger increase than the 0.5 percent gain expected by
analysts, data from Statistics Canada showed.             
    Sales volumes rose 1.2 percent, which could help boost gross
domestic product for the month. Data for July gross domestic
product is due on Friday.
    The price of oil, one of Canada's major exports, climbed
after Saudi Arabia and Russia ruled out any immediate increase
in production despite calls by U.S. President Donald Trump for
action to raise global supply.             
    U.S. crude        prices were up 1.9 percent at $72.14 a
barrel.    
    The U.S. dollar        fell against a basket of other
currencies ahead of a widely expected interest rate hike by the
U.S. Federal Reserve this week.             
    At 9:51 a.m. (1351 GMT), the Canadian dollar          was
trading nearly unchanged at 1.2915 to the greenback, or 77.43
U.S. cents. The currency, which has strengthened by 1.9 percent
over the last two weeks, traded in a range of 1.2911 to 1.2949. 
  
    The steady performance of the loonie on Monday occurred
despite the latest round of U.S.-Chinese tariffs taking effect,
with neither country showing signs of backing down from a
protracted trade war.
    Canada runs a current account deficit, so its economy could
be hurt if the global flow of trade or capital slows.
    The country has its own trade dispute with the United States
and is in talks to renew the North American Free Trade
Agreement.
     U.S. and Canadian officials are "very likely" to hold
informal talks on NAFTA on the sidelines of a major U.N. meeting
in the next few days, Canadian Prime Minister Justin Trudeau
said on Sunday.             
    Speculators have raised bearish bets on the Canadian dollar
for the third straight week, data from the U.S. Commodity
Futures Trading Commission and Reuters calculations showed on
Friday. As of Sept. 18, net short positions had increased to
30,111 contracts from 26,942 a week earlier.             
    Canadian government bond prices were lower across the yield
curve, with the 10-year             falling 14 Canadian cents to
yield 2.447 percent. The 10-year yield touched 2.459 percent,
the highest since May 22.

 (Reporting by Fergal Smith; Editing by Steve Orlofsky)
  
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