CANADA FX DEBT-Loonie on track to advance for week of Trudeau election win

    * Canadian dollar rises 0.1% against the greenback
    * For the week, the loonie was up 0.5%
    * Price of U.S. oil dips 0.3%
    * Canada's 10-year government bond gains 4 Canadian cents

    TORONTO, Oct 25 (Reuters) - The Canadian dollar edged higher
against its U.S. counterpart on Friday, adding to this week's
gain after investors took in stride the federal election win of
Prime Minister Justin Trudeau's Liberal party.
    Trudeau, who lost his majority in Parliament, has promised
since Monday's election to continue with the Trans Mountain
pipeline expansion, which could get more of Canada's oil to
international markets. He has also prioritized a tax cut for the
middle class.             
    Looser fiscal policy could boost the economy, reducing the
chances of interest rate cuts over the coming months from the
Bank of Canada.             
    Canada's central bank is expected to leave its benchmark
rate unchanged at 1.75% at next Wednesday's announcement and
through the rest of the year, a Reuters poll showed.
    Also next Wednesday, the U.S. Federal Reserve is seen easing
for the third time since July. That could lower the range for
the Fed's benchmark rate below the Bank of Canada's equivalent
rate for the first time since December 2016.
    At 10:04 a.m. (1404 GMT), the Canadian dollar          was
trading 0.1% higher at 1.3063 to the greenback, or 76.55 U.S.
cents. The currency, which posted on Thursday its strongest
intraday level in more than three months at 1.3053, traded in a
narrow range of 1.3058 to 1.3077.
    For the week, the loonie was on track to rise 0.5%.
    Friday's modest gain for the Canadian dollar came as
Mexico's Deputy Foreign Minister for North America, Jesus Seade,
said that he believes U.S. lawmakers will begin soon the formal
process of approving the new United States-Mexico-Canada (USMCA)
trade deal.
    Canada sends about 75% of its exports to the United States,
including oil.
    Oil prices dipped on Friday but were on track for strong
weekly gains as support from a surprise draw in U.S. inventories
and possible action from OPEC and its allies to extend output
cuts outweighed broader economic concerns. U.S. crude oil
futures        were down 0.3% at $56.08 a barrel.             
     Alberta, Canada's main oil-producing province, said on
Thursday its budget deficit would increase to C$8.7 billion in
the fiscal year ending March 31, up from C$6.7 billion in
2018-19, because of a provision made for potential losses on
crude-by-rail contracts that were signed by the previous
    The price of Canada's 10-year government bond rose 4
Canadian cents to yield 1.519%.

 (Reporting by Fergal Smith
Editing by Chizu Nomiyama)