CANADA FX DEBT-C$ weakens after recent rally as oil slips
* Canadian dollar at C$1.3019 or 76.81 U.S. cents * Bond prices higher across the maturity curve (Adds quotes, updates prices) TORONTO/OTTAWA, Oct 13 (Reuters) - The Canadian dollar weakened against its U.S. counterpart on Tuesday, hurt by a sharp fall in oil prices and gloomy trade data out of China. The loonie was unable to extend a recent rally that had seen it rise 2.2 percent since the beginning of October as it encountered technical resistance around the C$1.30 area. Fears that the oil market remains oversupplied saw the price of crude end down 44 cents at $46.66 a barrel. The Canadian dollar has been highly sensitive to the price of oil, which is a major export for Canada. The domestic economic calendar is light this week, but overseas data showed Chinese imports plunged 20 percent in September, casting doubt on the strength of domestic demand in the world's second-largest economy. "The loonie hasn't been able to have a sustained rally and so I think in the short-term, we see range-bound trading," said Rahim Madhavji, president at KnightsbridgeFX.com. The next catalyst is likely to be the timing of the Federal Reserve's move to raise interest rates, said Madhavji. The Fed held rates steady at its last meeting in September and economists are uncertain as to whether a hike will come this year, as had been expected. The Canadian dollar ended the North American trading session at C$1.3019 to the greenback, or 76.81 U.S. cents, weaker than the Bank of Canada's official close on Friday of C$1.2937, or 77.30 U.S. cents. According to Thomson Reuters data it closed at C$1.2998, or 76.93 U.S. cents on Monday, a public holiday in Canada. The loonie is likely to trade around C$1.30 to C$1.32, Madhavji said. Canadian government bond prices were higher across the maturity curve, with the two-year price up 4 Canadian cents to yield 0.540 percent and the benchmark 10-year rising 69 Canadian cents to yield 1.445 percent. (Reporting by Alastair Sharp and Leah Schnurr; Editing by Meredith Mazzilli)
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