CANADA FX DEBT-C$ firms to two-week high as crude jumps 3 pct

(Updates with closing figures, analyst comment, details)
    * Canadian dollar at C$1.2346 or 81.00 U.S. cents
    * Bond prices mostly lower across the maturity curve

    By Solarina Ho
    TORONTO, June 9 (Reuters) - The Canadian dollar strengthened
against its U.S. counterpart on Tuesday, as crude oil prices
rose on bets of another weekly drop in U.S. stockpiles and that
summer driving would fuel demand.
    With the Canadian domestic calendar fairly thin this week,
the loonie will likely take its cue from technical and external
influences such as oil.
    "Low conviction, low liquidity and high volatility is the
run of the markets at the moment," said Shaun Osborne, chief
currency strategist at TD Securities, noting that the market was
likely waiting for more U.S. data.
    "Oil prices rising more than 3 percent on the day is
obviously much more supportive for the Canadian dollar. In a
broader sense here ... the data for Canada has been a little bit
better probably than what the markets had been expecting."
    The Canadian dollar, which firmed against all of
its key currency counterparts, finished at C$1.2346 to the
greenback, or 81.00 U.S. cents, stronger than the Bank of
Canada's official close of C$1.2398, or 80.66 U.S. cents on
    This was the currency's strongest level since May 26. It
traded between C$1.2330 and C$1.2442 during the session.
    U.S. crude prices settled up 3.44 percent at $60.14,
while Brent crude added 3.5 percent to settle at $64.88
a barrel.
    Demand for oil tends to rise over the summer as more drivers
take to the roads for holidays in Europe and the United States.
There were also some hopes that weak Chinese data will prompt
more economic stimulus from the world's second-largest
    Osborne said in the near term, the Canadian dollar could
trade into the high C$1.21s or low C$1.22 level. Overall,
however, he was more cautious about Canada and did not expect
crude prices to rise much further.
    The next economic indicator to watch for was U.S. retail
sales, due on Thursday.
    Canadian government bond prices were mostly lower across the
maturity curve, with the two-year price down 6.5
Canadian cents to yield 0.663 percent and the benchmark 10-year
 falling 64 Canadian cents to yield 1.882 percent.
    The Canada-U.S. two-year bond spread was -5.8 basis points,
while the 10-year spread was -55.5 basis points.

 (Reporting by Solarina Ho; Editing by Meredith Mazzilli and
Diane Craft)