* C$ edges up to C$0.9876 to the U.S. dollar, or $1.0126
* Bond prices fall as risk sentiment perks up again
* Autos propel Canadian retail sales higher in June
By Ka Yan Ng
TORONTO, Aug 23 (Reuters) - The Canadian dollar added to gains against the U.S. currency on Tuesday after domestic data showed retail sales grew for a third straight month.
Retail sales in June were up 0.7 percent from May as auto sales roared back to life, Statistics Canada data showed. The increase matched forecasts. For details, see [ID:nN1E77M09U]
Excluding autos, sales fell by 0.1 percent in the month versus market expectations for a 0.2 percent increase. But May's advance was revised up to 0.3 percent from an initial 0.1 percent, and in volume terms, sales rose 1.6 percent.
"Kind of mixed, but I would say a net positive. Part of why CAD just hasn't moved on that is just that we're seeing a little bit of weakness coming out of euro right now," said Camilla Sutton, chief currency strategist at Scotia Capital.
"All in all, the U.S. dollar is materially weaker today and that is the broader trend. Equities are stronger, volatility is lower, so risk appetite is increasing as the market gets excited about what (U.S. Federal Reserve Chairman Ben) Bernanke might say."
The annual central bankers gathering in Jackson Hole, Wyoming, late this week remains the key event of the week.
Investors were more willing to take on riskier assets, such as stocks and some commodities, after gauges of Chinese and euro zone economic activity came in less gloomy than feared. That pushed lingering worries of the euro zone debt crisis aside, putting pressure on bond pricing. [MKTS/GLOB]
At 9:09 a.m. (1309 GMT), the Canadian dollar CAD=D4 was at C$0.9876 to the U.S. dollar, or $1.0126, up from C$0.9901 to the U.S. dollar, or $1.01, at Monday's session close.
The two-year bond CA2YT=RR was off 4 Canadian cents to yield 0.892 percent, while the 10-year bond CA10YT=RR edged down 20 Canadian cents to yield 2.329 percent.
Investors were waiting to see whether the U.S. Federal Reserve announces further economic stimulus, a year after Bernanke launched a second round of quantitative easing to revive the U.S. economy.
Jean Boivin, deputy governor at the Bank of Canada, is due to speak in Kingston, Ontario Tuesday in a speech titled "How people think and how it matters."
Analysts were not expecting Bernanke's speech on Friday to differ much from last week's testimony to a parliamentary committee by Bank of Canada Governor Mark Carney. [ID:nN1E77I0L1] (Reporting by Ka Yan Ng; editing by Jeffrey Benkoe)
