CANADA FX DEBT-C$ dips as oil falls; investors eye Bank of Canada speech

    * Canadian dollar at C$1.2521, or 79.87 U.S. cents
    * Bond prices lower across a steeper yield curve
    * Bank of Canada Deputy Governor Sylvain Leduc due to speak

    TORONTO, Oct 3 (Reuters) - The Canadian dollar slipped to a
one-month low against its U.S. counterpart on Tuesday as oil
prices fell and investors looked to a speech by Bank of Canada
Deputy Governor Sylvain Leduc for clues on the central bank's
next interest rate decision.
    Leduc is scheduled to speak about productivity in the
Canadian economy. The central bank will release the deputy
governor's prepared remarks at 12:30 p.m. EDT (1630 GMT).
    The Bank of Canada has raised rates twice since July, but
the chances of another hike as soon as this month have dwindled
to around 25 percent from nearly 40 percent before Governor
Stephen Poloz signaled last week that a third hike was not
    Prices of oil, one of Canada's major exports, edged lower as
speculators took profits on some large positions that have built
up in the last couple of weeks.             
    U.S. crude        prices were down 0.59 percent at $50.28 a
    At 9:00 a.m. EDT, the Canadian dollar          was trading
at C$1.2521 to the greenback, or 79.87 U.S. cents, down 0.1
percent. The currency's strongest level of the session was
C$1.2490, while it touched its weakest since Aug. 31 at
    Canadian government bond prices were lower across a steeper
yield curve in sympathy with U.S. Treasuries after U.S. data on
Monday backed expectations of another interest rate increase by
the Federal Reserve before the end of the year.
    The two-year bond            was down 1 Canadian cent to
yield 1.54 percent and the 10-year bond             declined 20
Canadian cents to yield 2.152 percent, moving closer to last
week's three-year high at 2.202 percent.
    Canada's trade data for August is due on Thursday and the
September employment report is scheduled for release on Friday.

 (Reporting by Fergal Smith; Editing by Paul Simao)