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CANADA FX DEBT-C$ posts 7-month high as Wall St rally bolsters sentiment

    * Canadian dollar rises 0.2% against the greenback
    * Canada's annual inflation rate in July falls to 0.1%
    * Canadian wholesale trade increases by a record 18.5% in
June 
    * Canadian bond yields trade mixed across the curve

    TORONTO, Aug 19 (Reuters) - The Canadian dollar climbed to
its strongest level in nearly seven months against its U.S.
counterpart on Wednesday after a record run for stocks on Wall
Street, with domestic data showing lower inflation doing little
to halt the currency's momentum.
    Stocks globally          edged up as a record high for U.S.
stocks outweighed simmering worries over a resurgence in
coronavirus cases that could undermine a nascent recovery.
            
    Canada runs a current account deficit and is a major
producer of commodities, including oil, so the loonie tends to
be sensitive to the global flow of trade and capital.
    U.S. crude        prices were down 0.8% at $42.53 a barrel
on concerns U.S. fuel demand will face a slow recovery amid
stalled talks on an economic stimulus package.                  
  
    The Canadian dollar        strengthened 0.2% to 1.3137 to
the greenback, or 76.12 U.S. cents. It notched its strongest
intraday level since Jan. 24 at 1.3133, helped by recent
pressure on the U.S. dollar       .
    Canada's annual inflation rate in July fell to 0.1%, 
Statistics Canada said. That was less than the 0.5% rate that
analysts had expected, while the average of the Bank of Canada's
core measures dipped to 1.6% from 1.7%.             
    Separate data from Statistics Canada showed that Canadian
wholesale trade increased by a record 18.5% in June from May as
large parts of the economy reopened following closures related
to the coronavirus pandemic. Analysts had forecast a 10.0%
increase.                     
    Canadian government bond yields were mixed across a flatter
curve, with the 10-year             dipping less than half of a
basis point to 0.561%.
    Canadian Prime Minister Justin Trudeau is weighing sweeping
changes to the country's social welfare system and a series of
economic measures that will align Canada with ambitious climate
goals, according to people familiar with the matter.
            

 (Reporting by Fergal Smith
Editing by Nick Zieminski)
  
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