CANADA FX DEBT-C$ weakens to 1-week low as lower oil, risk aversion weigh
* Canadian dollar at C$1.2851, or 77.81 U.S. cents * Loonie touched its weakest since June 6 at C$1.2873 * Bond prices mixed across flatter maturity curve * 10-year yield hit its lowest since Feb. 24 at 1.078 pct TORONTO, June 14 (Reuters) - The Canadian dollar weakened to a one-week low against a broadly firmer U.S. counterpart on Monday, as lower oil prices and market jitters about a potential British exit from the European Union weighed on the risk-sensitive commodity-linked currency. Britain's "Leave" campaign opened up a 7-point lead over "Remain" ahead of a referendum on membership in the European Union, an opinion poll showed late Monday. Global stocks were mostly lower and oil fell as investors flocked to safe-haven assets. At 9:59 a.m. EDT (1359 GMT), the Canadian dollar was trading at C$1.2851 to the greenback, or 77.81 U.S. cents, weaker than Monday's close of C$1.2807, or 78.08 U.S. cents. The currency's strongest level of the session was C$1.2816, while it touched its weakest since June 6 at C$1.2873. Stronger-than-expected U.S. retail sales data added to support for the greenback, suggesting economic growth was gaining steam. Still, chances of an interest rate increase by the U.S. Federal Reserve on Wednesday remained low. The CME Group's FedWatch tool indicated just a 1.9 percent probability of a rate hike. In domestic data, the ratio of Canadian household debt-to-income edged down to 165.3 percent in the first quarter from 165.4 percent in the fourth quarter, Statistics Canada said. Separately, Canadian home prices rose in May from a month earlier, and were well up from the year before, the Teranet-National Bank Composite House Price Index showed. Canadian government bond prices were mixed across a flatter maturity curve as Germany's 10-year yield turned negative on the flight-to-quality. The two-year price dipped 0.5 Canadian cent to yield 0.491 percent, while the benchmark 10-year climbed 22 Canadian cents to yield 1.089 percent. The 10-year yield hit its lowest since Feb. 24 at 1.078 percent. The curve flattened, as the spread between the 2-year and 10-year yields narrowed by 2.6 basis points to 59.8 basis points, indicating outperformance for longer-dated maturities. (Reporting by Fergal Smith; Editing by Nick Zieminski)
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