CANADA FX DEBT-C$ weakens after wholesale trade data disappoints
* Canadian dollar at C$1.0899 or 91.75 U.S. cents * Bond prices mixed across the maturity curve (Adds details, quotes, updates prices) By Leah Schnurr TORONTO, May 20 (Reuters) - The Canadian dollar weakened against the greenback on Tuesday after data showed an unexpected pullback in domestic wholesale trade in March. The loonie failed to hold above a key technical level but it stayed within its recent trading range. Analysts said more Canadian economic data later in the week, including retail sales and inflation figures, could act as stronger catalysts. Wholesale trade declined by 0.4 percent in March, hurt in part by weaker motor vehicle sales. The loonie added to declines after the data was released. A drop in the Australian dollar also weighed on the Canadian dollar, said Scott Smith, senior market analyst at Cambridge Mercantile Group in Calgary. The Australian dollar was hit after a central banker said capital flows into the country are likely to slow. The Reserve Bank of Australia also released minutes from its last meeting that showed board members thought the current low interest rate environment would be appropriate for some time. The loonie often moves alongside the Aussie as both are considered commodity-linked currencies. "It's almost a trifecta of little things that have piled up overnight and this morning that have led to some notable loonie weakness today," Smith said. The Canadian dollar ended the North American session at C$1.0899 to the greenback, or 91.75 U.S. cents, weaker than Friday's official close of C$1.0857, or 92.11 U.S. cents. Many market participants were away for Canada's Victoria Day holiday on Monday. The next resistance level sits at C$1.0910, said Rahim Madhavji, president of KnightsbridgeFX.com in Toronto. The loonie touched a session low of C$1.0917 before paring its declines. "We're back to a wait-and-see approach, probably continued range-bound trading just slightly below C$1.09. We'll wait to see how the data keeps impacting the way things move," Madhavji said. Canadian government bond prices were mixed across the maturity curve. The two-year was off half a Canadian cent to yield 1.042 percent, and the benchmark 10-year was down 11 Canadian cents to yield 2.276 percent. (Editing by Peter Galloway)
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