CANADA FX DEBT-C$ softer ahead of CPI, retail sales data

* Canadian dollar at C$1.2224 or 81.81 U.S. cents
    * Bond prices mostly lower across the maturity curve

    TORONTO, May 21 (Reuters) - The Canadian dollar softened
against its U.S. counterpart on Thursday, with little domestic
data to drive direction and with investors awaiting Canadian
inflation and retail sales figures due on Friday.
    Higher crude prices were unable to lift the Canadian dollar,
which has been hovering around the C$1.22 level this week
following a significant retreat on Monday.
    Markets had been positioning for a more cautious tone from
the Bank of Canada's governor, Stephen Poloz, given the recent
string of lukewarm data from the United States and uncertainty
around how they might impact Canada's own economic growth. Poloz
left the bank's views unchanged for the time being, however.
    "We like funds higher over the coming months on the basis
that the Canadian economic outlook in (the second half of) 2015
is overstated by the Bank of Canada," TD Securities said in a
research note. "Market sentiment around the Canadian dollar
remains bearish."
    * At 9:13 a.m. EDT (1313 GMT), the Canadian dollar 
was trading at C$1.2224 to the greenback, or 81.81 U.S. cents,
weaker than the Bank of Canada's official Wednesday close of
C$1.2196, or 81.99 U.S. cents.
    * The loonie has traded between C$1.2172 and C$1.2242 during
the session.
    * The number of Americans filing new claims for unemployment
benefits rose by 10,000, slightly more than expected last week,
but the underlying trend continued to suggest the labor market
was tightening. 
    * Canadian inflation data for April and retail sales figures
for March are due at 08:30 a.m. EDT on Friday.
    * U.S. crude prices were up 1.78 percent to $60.03,
while Brent crude added 1.23 percent to $65.83. 
    * The Canadian dollar, which was weaker than its key
currency counterparts, is expected to trade between C$1.2150 and
C$1.2250 against the U.S. dollar on Thursday, according to
National Bank Financial.
    * Canadian government bond prices were mostly lower across
the maturity curve, with the two-year price down 1
Canadian cent to yield 0.685 percent and the benchmark 10-year
 rising 3 Canadian cents to yield 1.792 percent.
    * The Canada-U.S. two-year bond spread was 9.2 basis points,
while the 10-year spread was -44.7 basis points.

 (Reporting by Solarina Ho; Editing by Meredith Mazzilli)