CANADA FX DEBT-C$ falls on soft U.S. retail sales report
* C$ falls to 96.48 U.S. cents
* U.S. retail sales had risen for seven straight months
* Bond prices rise following a slump in recent days
By John McCrank
TORONTO, June 11 (Reuters) - Canada's dollar fell against the greenback on Friday after a weaker-than-expected retail sales report out of the United States, which consumes around three quarters of Canadian exports.
U.S. retail sales, which had risen for seven straight months, unexpectedly fell in May due to a record slump in building materials purchases, added to fears the economic recovery was losing some steam. [ID:nN11109609]
Total retail sales dropped 1.2 percent, versus forecasts of 0.2 percent growth.
"The soft U.S. retail sales report might flag a softening of Canadian exports to the U.S., if the U.S. consumer is indeed flagging," said Sal Guatieri, a senior economist at the BMO Capital Markets.
At 9.06 a.m., The Canadian dollar was at C$1.0365 to the U.S. dollar, or 96.48 U.S. cents, compared with Thursday's North American finish of C$1.0312 to the U.S. dollar, or 96.97 U.S. cents.
The price of U.S. crude oil tumbled after the retail sales report from the world's No. 1 energy user, to below $74 a barrel from the $75 mark. [O/R]
Canada is the biggest oil supplier to the United States, and its currency is often influenced by moves in it, as well as other commodities that Canada produces.
CANADIAN BONDS EXTEND GAINS
Canadian bond prices extended gains across the curve after the U.S. data. Prices had fallen in recent days as investor became less risk averse.
The two-year government bond CA2YT=RR rose 3 Canadian cents to yield 1.804 percent, while the 10-year bond CA10YT=RR rose 40 Canadian cents to yield 3.387 percent. (Editing by Jeffrey Hodgson)
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