CANADA FX DEBT-C$ little changed as inflation data weighs on greenback

    * Canadian dollar at C$1.2470, or 80.19 U.S cents
    * U.S. crude        prices rise 1.60 percent
    * Bond prices higher across a flatter yield curve

    TORONTO, Oct 13 (Reuters) - The Canadian dollar was little
changed against its U.S. counterpart on Friday, clawing back
earlier losses as oil prices rose and as data showing
weaker-than-expected U.S. underlying inflation weighed on the
    The U.S. dollar        retreated against a basket of major
currencies after a modest reading in the core CPI, which is
likely to worry Federal Reserve officials who have been engaged
in a vigorous debate on the inflation path.             
    In contrast, the Bank of Canada pulled the trigger with two
rate increases since July, trusting its projections and betting
that stronger growth will help push inflation to its target by
the middle of next year.             
    Prices of oil, one of Canada's major exports, were boosted
by strong Chinese oil imports and turmoil in the Middle East.
    U.S. crude        prices were up 1.60 percent at $51.41 a
    At 9:25 a.m. ET (1325 GMT), the Canadian dollar          was
little changed at C$1.2470 to the greenback, or 80.19 U.S.
    The currency traded in a range of C$1.2450 to C$1.2512.
    Officials from Mexico and Canada said that talks underway to
renegotiate the North American Free Trade Agreement (NAFTA)
should not add a so-called "sunset clause" that would force
renegotiation of the $1 trillion pact every five years.
    The resale of Canadian homes grew 2.1 percent in September
from August, led by gains in Toronto and Vancouver, suggesting
national sales may be stabilizing after cooling sharply in the
spring, the Canadian Real Estate Association said.             
    Canadian government bond prices were higher across a flatter
yield curve in sympathy with U.S. Treasuries. The two-year
           rose 5.6 Canadian cents to yield 1.551 percent and
the 10-year             climbed 56 Canadian cents to yield 2.044

 (Reporting by Fergal Smith; Editing by Bernadette Baum)