* C$ at C$1.0352 vs US$, or 96.60 U.S. cents * U.S. jobless claims rise, Q1 GDP estimates scaled back * Canadian PPI down for first time in five months; Q1 current account gap narrows * Japan's public pension fund considers more flexible investing strategy * Yield for 10-year government bonds highest in more than year By Solarina Ho TORONTO, May 30 (Reuters) - The Canadian dollar on Thursday trimmed losses against the U.S. dollar, which weakened against a string of currencies after data showed U.S. jobless claims rose and estimates of first-quarter U.S. economic growth were scaled back. The Canadian dollar's retreat this past month was largely driven by broad strength in the greenback. Thursday's U.S. data, however, reinforced the view that the U.S. economy may be entering yet another soft patch. In Canada, producer prices were down for the first time in five months, while the current account gap narrowed in the first quarter. The Canadian currency's strength was capped, however, following a Reuters story that said Japan's public pension fund - worth over $1 trillion - was considering a change in strategy. "We actually had a current account in Canada that was slightly better than market expectations, but weighing against that is that most of the commodity currencies are lower today," said Mark Chandler, head of Canadian fixed income and currency strategy at RBC Capital Markets. "The thing that's getting a lot of chatter is the potential in Japan for the pension fund there to start reallocating toward domestic equities and away from international assets. That's weighting a little bit on commodity currencies." At 9:40 a.m. (1340 GMT), the Canadian dollar was trading at C$1.0352 versus the U.S. dollar, or 96.60 U.S. cents, stronger than shortly before the data was released, and unchanged from Wednesday's North American close. Canada's dollar was generally underperforming against other currencies, but was slightly stronger against its commodities-linked sister currencies, the Australian and New Zealand dollars. Looking ahead, quarterly and monthly gross domestic product data out of Canada will be released tomorrow. First quarter GDP is expected to rise 2.3 percent on an annualized basis, according to a Reuters poll. "The improvement in the goods account reaffirms our expectation that net exports are poised to be a meaningful contributor to Q1 GDP," Mazen Issa, Canada macro strategist at TD Securities wrote in a note to clients. "More importantly, the contribution from net exports will reflect positive underpinnings - that is, the trade improvement will be driven by strength in exports." Canadian government bond prices were mixed, with the two-year bond up half a Canadian cent to yield 1.074 percent and the benchmark 10-year bond off half a Canadian cent to yield 2.073 percent, its highest yield in more than a year.