CANADA FX DEBT-C$ posts fresh 1-week high as oil prices climb
* Canadian dollar at $1.3042, or 76.68 U.S. cents * Loonie touches its strongest since Feb. 6 at C$1.3025 * Bond prices slightly lower across the yield curve * 10-year yield touches its highest since Feb. 3 at 1.751 percent TORONTO, Feb 14 (Reuters) - The Canadian dollar strengthened to set a one-week high against its U.S. counterpart on Tuesday as oil prices rose and the resignation of U.S. President Donald Trump's national security adviser pressured the greenback. Gains for the Canadian dollar came one day after Trump downplayed potential changes to trade ties between the United States and Canada. The U.S. dollar partially recovered from its earlier decline against a basket of currencies on the resignation of Michael Flynn as data showed a stronger-than-forecast rise in U.S. producer prices. Investors were also bracing for testimony from Federal Reserve chief Janet Yellen that may offer clues to the timing of the next U.S. interest rate rise. U.S. crude prices were up 1.28 percent at $53.61 a barrel, supported by an effort led by the Organization of the Petroleum Exporting Countries to cut output. Oil is one of Canada's major exports. At 9:13 a.m. ET (1413 GMT), the Canadian dollar was trading at C$1.3042 to the greenback, or 76.68 U.S. cents, stronger than Monday's close of C$1.3075, or 76.48 U.S. cents. The currency's weakest level of the session was C$1.3078, while it touched its strongest since Feb. 6 at C$1.3025. In domestic data, home prices rose 0.5 percent in January and 13.0 percent from a year earlier as values in the hot Toronto market climbed even further and those in Vancouver picked up after three months of declines, the Teranet-National Bank Composite House Price Index showed. Canadian government bond prices were slightly lower across the yield curve in sympathy with U.S. Treasuries ahead of Yellen's testimony. The two-year dipped 0.5 Canadian cent to yield 0.789 percent, and the 10-year declined 7 Canadian cents to yield 1.740 percent. The 10-year yield touched its highest intraday since Feb. 3 at 1.751 percent. Canadian manufacturing sales data for December is due on Wednesday. (Reporting by Fergal Smith; Editing by Lisa Von Ahn)
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