* Canadian dollar rises 0.1% against the greenback * Canada posts narrowest trade deficit in six months * Price of U.S. oil falls 0.2% * Canadian bond prices rise across a flatter yield curve TORONTO, June 6 (Reuters) - The Canadian dollar edged higher against its U.S. counterpart on Thursday as the greenback broadly declined, while domestic data showed Canada's smallest trade deficit in six months. Rising exports and falling imports helped shrink Canada's trade deficit in goods in April to C$966 million, Statistics Canada said, in the latest sign the economy is recovering from a slowdown. April's trade deficit was the smallest since October last year. The U.S. dollar , which has been pressured this week by speculation that the Federal Reserve would cut interest rates, lost ground against a basket of major currencies. The decline for the greenback came as the ECB refrained from hinting at an interest rate cut, boosting the euro . At 9:06 a.m. (1306 GMT), the Canadian dollar was trading 0.1% higher at 1.3396 to the greenback, or 74.65 U.S. cents. The currency, which on Wednesday touched its strongest in two weeks at 1.3363, traded in a range of 1.3390 to 1.3431. Despite recent upbeat domestic data, including a record jobs gain in April, money markets expect the Bank of Canada to cut interest rates by the end of the year. The Canadian dollar is likely to strengthen less than previously expected against its U.S. counterpart over the coming year, because of more attractive valuations and better prospects for return in other currencies, a Reuters poll showed. Mexican and U.S. officials are set to resume talks in Washington on Thursday aimed at heading off punitive tariffs on Mexican goods after President Donald Trump said more needed to be done to curb migration at the southern U.S. border. Investors worry that the tariffs could undermine chances of a new North American trade deal coming into force. Canada sends about 75% of its exports, including oil, to the United States. The price of oil held near a five-month low due to rising U.S. supply and a stalling global economy. U.S. crude oil futures were down 0.2% at $51.59 a barrel. Canadian government bond prices were higher across a flatter yield curve, with the two-year up 2 Canadian cents to yield 1.333% and the 10-year rising 12 Canadian cents to yield 1.435%. On Wednesday, the 10-year yield touched its lowest intraday since June 2017 at 1.410%. Canada's jobs report for May is due on Friday. (Reporting by Fergal Smith; Editing by David Gregorio)
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