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

* Canadian dollar at C$1.2208 or 81.91 U.S. cents
    * Bond prices mostly higher across the maturity curve

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    OTTAWA, May 21 (Reuters) - The Canadian dollar was little
changed against the greenback on Thursday, as a rebound in the
price of oil was not enough to spur investors awaiting domestic
inflation and retail sales figures due on Friday.
    The loonie 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 that might impact Canada's own economic growth. 
    Poloz left the bank's views unchanged for the time being,
however, and the loonie has drifted.
    Fighting in Iraq and optimism that the glut of crude
supplies is easing helped push U.S. crude to settle up
$1.74 at $60.72 a barrel. 
    The Canadian dollar, normally sensitive to the price of oil,
had little reaction.
    "If you look at the majors, Canada has been one of the
weaker currencies," said Mark Chandler, head of Canadian fixed
income and currency strategy at RBC Capital Markets. "To be
honest, it flies in the face a little bit of what we saw in
energy today."
    The Canadian dollar ended the North American
session at C$1.2208 to the greenback, or 81.91 U.S. cents,
slightly weaker than the Bank of Canada's official Wednesday
close of C$1.2196, or 81.99 U.S. cents.
    The Canadian inflation report due on Friday could be the
economic highlight of the week. Inflation is expected to have
cooled to an annual 1 percent rate in April, while the core
measure is seen holding at a firmer 2.4 percent. 
    Chandler said there could be some downside risk to the
inflation numbers, which could have an impact on the currency.
    Retail sales, to be released at the same time, are expected
to have increased by a modest 0.3 percent in March.
    Canadian government bond prices were mostly higher across
the maturity curve, with the two-year price up 2
Canadian cents to yield 0.669 percent and the benchmark 10-year
 up 42 Canadian cents to yield 1.751 percent.
    The Canada-U.S. two-year bond spread was 9.6 basis points,
while the 10-year spread was -44.6 basis points.

 (Reporting by Leah Schnurr in Ottawa and Solarina Ho in
Toronto; Editing by Leslie Adler)