CANADA FX DEBT-Loonie slumps to 1-week low ahead of Bank of Canada rate decision

    * Canadian dollar weakens 1.6% against the greenback
    * Canada's economy shrinks by an estimated 9% in March
    * Price of U.S. oil decreases 2.9%
    * Canadian bond yields fall across a flatter curve

    By Fergal Smith
    TORONTO, April 15 (Reuters) - The Canadian dollar weakened
to a one-week low against its U.S. counterpart on Wednesday
ahead of an interest rate announcement by the Bank of Canada and
as Canada's national statistical agency estimated a deep
economic contraction in March.
    Canada's economy shrank a record 9% in March from the
previous month as the coronavirus outbreak forced the shutdown
of economic activity during the course of the month, Statistics
Canada said in a flash estimate.
    The Bank of Canada interest rate decision is due at 10 a.m.
ET (1400 GMT). Money markets expect the central bank to leave
its benchmark interest rate on hold at 0.25% but analysts see a
chance that the BoC announces additional measures to support the
economy, such as forward guidance on monetary policy or
adjustments to its asset-purchase program.               
    "We're not expecting any policy changes from the BoC
following an extraordinary month of March," Benjamin Reitzes,
Canadian rates & macro strategist at BMO Capital Markets, said
in a note. "If the Bank were to ease further, buying provincial
bonds seems like the next logical step."
    Since the start of March, the BoC has slashed interest rates
by a total of 150 basis points, in a series of emergency moves,
and begun buying at least C$5 billion of government bonds per
    At 8:52 a.m. (1252 GMT), the Canadian dollar          was
trading 1.6% lower at 1.4105 to the greenback, or 70.90 U.S.
cents. The currency touched its weakest intraday level since
April 7 at 1.4110.    
    The price of oil, one of Canada's major exports, was
pressured by reports of persistent oversupply and collapsing
demand due to global coronavirus-related lockdowns and a lack of
coordinated oil purchases for strategic storage. U.S. crude oil
futures        were down 2.9% at $19.52 a barrel.               
    Canadian government bond yields fell across a flatter curve,
with the 10-year down 11.1 basis points at 0.647%.

 (Reporting by Fergal Smith
Editing by Nick Zieminski)