CANADA FX DEBT-C$ softens ahead of rate decision; bank statement in focus

* Canadian dollar at C$1.2518 or 79.88 U.S. cents
    * Bond prices mixed across the maturity curve

    By Solarina Ho
    TORONTO, March 4 (Reuters) - The Canadian dollar was softer
against the U.S. dollar on Wednesday, with market attention
focused on the interest rate decision by the Bank of Canada
later this morning.
    The Bank of Canada is widely expected to keep rates at 0.75
percent following January's stunning 25 basis point cut, after
Governor Stephen Poloz said that cut was an "insurance" as it
looked at the impact of cheap crude prices on the Canadian
    "The bigger question for us is how the market comes out of
this priced for the subsequent meeting," said Adam Cole, global
head of FX strategy at RBC Capital Markets in London.
    "If the statement leaves wide open the possibility of
another rate cut in the relative near-term, that, I think, is
probably still negative for the currency even if it comes with
unchanged rates today."
    The Canadian dollar was at C$1.2518 to the
greenback, or 79.88 U.S. cents at 8:39 a.m (1339 GMT), weaker
than Tuesday's finish at C$1.2490, or 80.06 U.S. cents.
    Most currency strategists are still calling for a weaker
Canadian dollar in coming months, according to a Reuters poll
released on Wednesday. 
    The markets are currently pricing in about a 55 percent
chance of a 25 basis point rate cut at the central bank's next
meeting in April.
    Canadian government bond prices were mixed across the
maturity curve, with the longer-term securities lower. The
two-year rose 1.5 Canadian cents to yield 0.491
percent and the benchmark 10-year fell 12 Canadian
cents to yield 1.436 percent.

 (Reporting by Solarina Ho; Editing by Nick Zieminski)