CANADA FX DEBT-C$ weakens as Ontario votes, BoC frets about trade

 (Adds strategist quote, details on activity; updates prices)
    * Canadian dollar at C$1.2982, or 77.03 U.S. cents
    * Price of U.S. oil rises 1.9 percent
    * Bond prices higher across the yield curve
    * 10-year yield touches near 2-week high intraday at 2.340

    By Fergal Smith
    TORONTO, June 7 (Reuters) - The Canadian dollar weakened
against its U.S. counterpart on Thursday as voters in Ontario
headed to the polls and after the Bank of Canada fretted about a
more uncertain trade outlook.
    Trade uncertainty feels more risky than it did in April, the
head of the Bank of Canada said, noting the impact of U.S.
tariffs on aluminum and steel imports will be incorporated into
updated economic forecasts next month.             
    Ontario voters were voting on Thursday in an election all
but certain to end 15 years of Liberal rule in Canada's most
populous province, with Doug Ford's Progressive Conservative
Party leading in opinion polls.             
    At 4 p.m. EDT (2000 GMT), the Canadian dollar          was
trading 0.3 percent lower at C$1.2982 to the greenback, or 77.03
U.S. cents. Still, the C$1.2935 to C$1.3002 range for the
currency kept it within its recent holding pattern.
    Leaders of the Group of Seven rich nations were headed to
Canada for a summit more divided than at any time in the group's
42-year history, as U.S. President Donald Trump's "America
First" policies risk causing a global trade war and deep
diplomatic schisms.             
    "People are sitting on their hands and waiting to see if
anything comes out of the G7," said Colin Cieszynski, chief
market strategist at SIA Wealth Management.
    Canada's dollar will strengthen over the coming year as
economic growth prompts the Bank of Canada to raise interest
rates again, a Reuters poll showed, but strategists see risk to
their bullish forecasts from talks to revamp the North American
Free Trade Agreement.             
    The price of oil, one of Canada's major exports, was lifted
by concern about a steep drop in exports from Venezuela and
worries OPEC may not raise production at its meeting this month.
    U.S. crude oil futures        settled 1.9 percent higher at
$65.95 a barrel.
    The U.S. dollar        fell against a basket of major
currencies as bets that the European Central Bank will next week
signal a winding down of its vast bond-buying program by the end
of this year boosted the euro.             
    Canadian government bond prices were higher across the yield
curve in sympathy with U.S. Treasuries. The two-year           
rose 6 Canadian cents to yield 1.909 percent and the 10-year
            climbed 21 Canadian cents to yield 2.284 percent.
    The 10-year yield touched its highest intraday since May 25
at 2.340 percent.
    Canada's employment report for May is due on Friday.

 (Reporting by Fergal Smith; Editing by Nick Zieminski and Grant