CANADA FX DEBT-C$ pares losses from 1-week low
* C$ slips to C$0.9769 to the U.S. dollar, or $1.0236
* Bonds mostly higher across the curve
TORONTO, June 2 (Reuters) - The Canadian dollar recovered on Thursday from a one-week low hit overnight against the U.S. currency, clawing back tentatively even as uncertainty about the global economic recovery weighed.
Meanwhile, most bond prices marched higher on the economic jitters.
The Canadian dollar dropped as low as C$0.9802 to the U.S. dollar, or $1.0202, its lowest in a week, but had recovered about 40 basis points to trade almost flat from the previous session's close as the North American session got underway.
U.S. stock index futures advanced on Thursday, while the price of oil edged higher, putting a bit of positive outlook for the North American session.
But economic data could easily turn sentiment around.
"Part of the overhang is that we have nonfarm expected tomorrow and the potential for a weaker nonfarm may be weighing on traders' minds," said Camilla Sutton, chief currency strategist at Scotia Capital, referring to the U.S. Labor Department's non-farm employment report.
"Even though the actual consensus is potentially unchanged, the whisper number is a lot lower."
Friday's U.S. jobs data for May is the highly-anticipated release of the week. Wednesday's private payrolls data hinted at a weak jobs report, a key monthly driver of financial markets given employment growth is one of the U.S. Federal Reserve's two mandates.
Markets are already prepared for data that will likely show U.S. employment cooled in May, confirming the economy's loss of momentum as it grapples with a raft of headwinds ranging from high energy prices and bad weather to supply chain disruptions from the earthquake in Japan. [ID:nN31283560]
A weak figure would add to a recent stretch of soft data that has reinforced concerns about an uneven economic recovery, particularly in the United States, making investors take riskier assets off the table.
More U.S. data on Thursday could add fuel to those concerns, with U.S. weekly jobless claims, due at 1230 GMT, factory orders at 1400 GMT as well as chain store sales for last month.
At 7:50 a.m. (1150 GMT), the Canadian dollar CAD=D4 was at C$0.9769 to the U.S. dollar, or $1.0236, down slightly from Wednesday's North American session close at C$0.9757 to the U.S. dollar, or $1.0249.
Canada's two-year bond CA2YT=RR rallied 12 Canadian cents to yield 1.440 percent, the 10-year bond CA10YT=RR was flat to yield 2.991 percent.
(Reporting by Ka Yan Ng, Editing by Chizu Nomiyama)
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