CANADA FX DEBT-C$ steadies after last week's sharp drop
* Canadian dollar at C$1.0811 or 92.50 U.S. cents * Bond prices mostly lower across the maturity curve By Leah Schnurr TORONTO, July 28 (Reuters) - The Canadian dollar was little changed against the greenback on Monday, steadying after the previous session's sharp drop while investors positioned themselves ahead of some key economic reports on both sides of the border. Still, the currency stayed weaker than the C$1.08 level, which could lead to more downside after it fell through some significant technical levels on Friday. "The price action that we're seeing in the loonie this morning is seeing a bit of a bid but essentially unchanged, and that's just a pause from the big selloff we saw on Friday," said Scott Smith, senior market analyst at Cambridge Mercantile Group in Calgary. If this week's U.S. economic data comes in stronger than expected, it could provide enough momentum to send the loonie into the C$1.09s, Smith said. The Canadian dollar was at C$1.0811 to the greenback, or 92.50 U.S. cents, a tad stronger than Friday's close of C$1.0814 or 92.47 U.S. cents. After last week's relatively quiet domestic calendar, investors will get a look at more economic data in the coming days, including Canadian economic growth for May and producer prices for June. But the bigger focal point will be the United States this week, where markets will get the first reading of second-quarter growth figures and the July unemployment report, as well as a Federal Reserve meeting. The U.S. gross domestic product report could have the biggest impact on markets, with risk to the downside if the economy doesn't achieve the 3 percent growth rate economists forecast, Smith said. While that could hurt the U.S. dollar, it could be a benefit to the loonie. "If we do see something come in lower than expected, I don't think markets are necessarily prepared for that," he said. Canadian government bond prices were mostly lower across the maturity curve, with the two-year off 1 Canadian cent to yield 1.088 percent. The benchmark 10-year was unchanged to yield 2.120 percent, holding at a more than one-year low. (Editing by Peter Galloway)
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