CANADA FX DEBT-C$ strengthens on relief rally as Turkish lira rebounds

    * Canadian dollar at C$1.3079, or 76.46 U.S. cents
    * Price of U.S. oil falls 0.2 percent
    * Bond prices edge lower across a steeper yield curve

    By Fergal Smith
    TORONTO, Aug 14 (Reuters) - The Canadian dollar strengthened
against its U.S. counterpart on Tuesday as the currency
rebounded from a near three-week low the day before, supported
by higher global stock prices and the ebbing threat from a
collapse of the Turkish lira.
    At 3:25 p.m. EDT (1925 GMT), the Canadian dollar         
was trading 0.4 percent higher at C$1.3079 to the greenback, or
76.46 U.S. cents. The currency traded in a range of C$1.3071 to
    On Monday, the loonie touched its weakest since July 24 at
    "It appears to be more of a relief rally than anything
(Canadian) specific ... reversing some of yesterday's moves,"
said Eric Theoret, currency strategist at Scotiabank. 
    World equities markets regained their footing as Turkey's
currency rebounded about 6 percent against the greenback and
reassuring German economic data that offset signs of slowing
growth in China.             
    Investors have worried that a crisis in Turkey could spread
to other emerging market countries. Canada exports many
commodities and runs a current account deficit so its economy
could be hurt if the flow of trade or capital slows.
    Canada said it will consider a safeguard action on seven
steel products to protect domestic producers from imports since
the United States imposed tariffs against its major trade
partner in March.                    
    The price of oil, one of Canada's major exports fell. U.S.
crude oil futures        settled 0.2 percent lower at $67.04 a
    Canadian home prices rose in July from June on broad-based
gains in most parts of Canada, but the price increases were
small compared with historical averages for the month, the
Teranet-National Bank Composite House Price Index data showed on
    Canada's manufacturing sales data for June is due on
Thursday and the July inflation report is set for Friday.
    Canadian government bond prices edged lower across a steeper
yield curve in sympathy with U.S. Treasuries as demand faded for
safe-haven assets such as government bonds.
    The two-year            fell 1 Canadian cent to yield 2.116
percent and the 10-year             declined 9 Canadian cents to
yield 2.313 percent.

 (Reporting by Fergal Smith
Editing by Jeffrey Benkoe and Tom Brown)