* C$ closes at C$1.0519 to the U.S. dollar
* First lower close for C$ since last week
* Bond prices edge higher on short end (Recasts)
By Frank Pingue
TORONTO, Nov 12 (Reuters) - The Canadian dollar fell on Thursday, ending a string of three straight higher closes, given a mix of lower prices for key exports like oil and gold and a general lack of risk appetite.
The price of oil, which often influences the currency, fell nearly three percent after data showed a rise in U.S. crude inventories. [O/R] Gold prices fell from record highs as the U.S. dollar recovered. [GOL/]
The pullback in the Canadian dollar came after it had entered the North American session up about 3 percent on the week.
"Earlier this week we saw continued risk appetite but sentiment changed overnight and we saw some profit taking and that led to increased selling of riskier assets," said Matthew Strauss, senior currency strategist at RBC Capital Markets.
"Ultimately it boiled down to a rally that might have been overdone and questions being asked about whether the rally in riskier assets truly reflects a realistic growth scenario."
The Canadian dollar closed at C$1.0519 to the U.S. dollar, or 95.07 U.S. cents, down from C$1.0461 to the U.S. dollar, or 95.59 U.S. cents, on Wednesday, which was its highest close since Oct. 21.
It briefly pared some of its losses after data showed new home prices in Canada rose a sharper-than-expected 0.5 percent in September from August. [ID:nOTT003772]. But the impact was short-lived and the currency resumed its slide.
BONDS END FLAT
Canadian bond prices ended the session flat with some buying in the short end of the curve as a backdrop of weaker North American equities triggered some interest in more secure government debt.
Toronto's main stock index ended down 0.7 percent, while the Dow Jones industrial average shed 0.91 percent.
The rise in short-end prices also followed a record $16 billion 30-year bond auction in the United States that rounded off a successful week for a massive refunding program that signaled no let up in appetite for U.S. government debt.
Midway through the session, the Bank of Canada said its C$3 billion auction of 1.5 percent government of Canada bonds due March 2012 yielded an average 1.608 percent. [CA/AUC]
The next Canadian data due is Friday's September trade report, which is expected to show the trade deficit narrowed to C$1.75 billion from C$1.99 billion in August.
The two-year bond CA2YT=RR rose 3 Canadian cents to C$99.72 to yield 1.390 percent, while the 10-year bond CA10YT=RR fell 4 Canadian cents to C$101.93 to yield 3.509 percent.
Canadian government bonds underperformed U.S. issues across most of the curve, with the 10-year yield 6.70 basis points above its U.S. counterpart, compared with 3.50 basis points in the previous session.
Several new bond issues were priced, including offerings by the province of Quebec, TransAlta Corp and Canadian Pacific Railway. [CAN-ISU] (Editing by Jeffrey Hodgson)