CANADA FX DEBT-C$ firms, bouncing off technical resistance

* Canadian dollar at C$1.0962 or 91.22 U.S. cents
    * Bond prices mostly higher across the maturity curve

    By Leah Schnurr
    TORONTO, Aug 26 (Reuters) - The Canadian dollar firmed
against the greenback on Tuesday, recovering from a nearly
four-month low hit in the overnight session as a dearth of
domestic economic data left the loonie drifting.
    The low had brought the currency within a hair of the
psychologically important C$1.10 level, which investors see as a
key resistance threshold.
    The failure to pierce that level is not very encouraging for
the U.S. dollar-Canadian dollar bulls from a technical
perspective, said Camilla Sutton, chief currency strategist at
Scotiabank in Toronto.
    "The more important piece is it likely only takes a small
piece of broad U.S. dollar strength to drive U.S.
dollar-Canadian higher through that very important C$1.10," she
    "I suspect U.S. dollar-Canadian dollar actually proves very
comfortable on either side of that level."
    The Canadian dollar was at C$1.0962 to the
greenback, or 91.22 U.S. cents, stronger than Monday's close of
C$1.0981, or 91.07 U.S. cents. 
    The loonie hit a low of C$1.0998 in overnight trading. The
last time the currency pairing was higher than C$1.10 was in
early May.
    There is little on the economic calendar for Canada this
week until gross domestic product figures are released on
Friday. The Canadian economy slowed in the first three months of
the year, partly due to a severe winter, and economists are
looking for a bounce back in the second quarter. 
    The market is also focused on the possible path of monetary
policy ahead of an upcoming Bank of Canada interest rate
decision and following comments from Governor Stephen Poloz at
last week's conference in Jackson Hole, Wyoming.
    Poloz said the central bank will not necessarily immediately
follow the United States when the Fed starts hiking rates, the
Globe and Mail reported. The Bank of Canada will release its
next policy statement on Sept. 3.
    "The domestic side has improved materially, yet Poloz is
clearly still neutral but leaning toward a more dovish side,
favoring growth over inflation," said Sutton.
    Canadian government bond prices were mostly higher across
the maturity curve, though the two-year was off 0.3
Canadian cents to yield 1.091 percent. The benchmark 10-year
 was up 4 Canadian cents to yield 2.039 percent.

 (Editing by Meredith Mazzilli)