CANADA FX DEBT-C$ firms as markets stabilize after Brexit-related volatility
* Canadian dollar at C$1.3054, or 76.60 U.S. cents * Bond prices slightly lower across the maturity curve TORONTO, June 28 (Reuters) - The Canadian dollar strengthened slightly against the greenback on Tuesday as stabilization in global financial markets after volatility triggered by Britain's vote to leave the European Union helped support Canada's risk-sensitive currency. Gains for the loonie came after it hit a three-week low on Monday at C$1.3120 as Brexit-related shockwaves filtered through global financial markets. Global stocks rose as bargain hunting trumped still widespread uncertainty over Brexit and oil prices rallied as investors took advantage of a two-day slide. U.S. crude prices were up 2.65 percent at $47.56 a barrel. At 9:13 a.m. EDT (1313 GMT), the Canadian dollar was trading at C$1.3054 to the greenback, or 76.60 U.S. cents, slightly stronger than Monday's close of C$1.3073, or 76.49 U.S. cents. The currency's strongest level of the session was C$1.2967, while its weakest was C$1.3086. Canada's commodity-linked economy will suffer weaker growth because of Britain's vote to leave the EU, which has put the prospect of Canadian interest rate cuts back on the table. Overnight index swaps implied a nearly one-third chance of a Bank of Canada rate cut this year after having been priced for no change in policy before Brexit. Canadian government bond prices were slightly lower across the maturity curve as the rally in safe-haven assets paused. The two-year price dipped 2 Canadian cents to yield 0.499 percent and the benchmark 10-year fell 5 Canadian cents to yield 1.084 percent. On Monday, the 10-year yield hit its lowest in 11 days at 1.077 percent. Canada's gross domestic product data for April is awaited on Thursday. Economic growth is expected to have edged up 0.1 percent following two months of declines. Even so, the gain is unlikely to change expectations from analysts and policymakers that second-quarter growth will be flat at best due to the impact of massive wildfires in oil-producing Alberta. (Reporting by Fergal Smith; Editing by Marguerita Choy)
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