C$ hits a six-week low amid weaker commodities, soft data

TORONTO (Reuters) - The Canadian dollar weakened to a fresh six-week low against its broadly firmer U.S. counterpart on Thursday as Federal Reserve interest rate hike speculation weighed on commodity markets, while domestic data was weaker than expected.

A Canadian dollar coin, commonly known as the "Loonie", is pictured in this illustration picture taken in Toronto January 23, 2015. REUTERS/Mark Blinch

The U.S. dollar rose against a basket of major currencies, supported by a perceived increase in chances of a rise in U.S. interest rates by September after hawkish Fed minutes on Wednesday. [USD/][FED/]

Oil prices fell, pressured by a stronger dollar and as a surprise increase in U.S. crude inventories suggested supply remains ample despite output problems. U.S. crude CLc1 prices were down 1.76 percent to $47.34 a barrel.[O/R]

The value of Canadian wholesale trade dropped by a deeper-than-expected 1.0 percent in March, pulled down in part by weaker sales in the motor vehicles and parts subsector, Statistics Canada said. In volume terms, the drop in sales was less pronounced at 0.4 percent.

At 9:19 a.m. EDT (1319 GMT), the Canadian dollar CAD=D4 was trading at C$1.3139 to the greenback, or 76.11 U.S. cents, much weaker than Wednesday's close of C$1.3023, or 76.79 U.S. cents.

The currency’s strongest level of the session was C$1.3012, while it hit its weakest since April 8 of C$1.3155.

Firefighters battling a wildfire that has threatened oil sands facilities north of Fort McMurray, Alberta looked to cooler weather and the promise of rain on Thursday. The fire has surged north of Fort McMurray this week, forcing the evacuation of 8,000 oil sand workers and prolonging a shutdown that has cut Canadian oil output by a million barrels a day.

Canadian government bond prices were mixed across the maturity curve, with the two-year CA2YT=RR price flat to yield 0.64 percent and the benchmark 10-year CA10YT=RR falling 1 Canadian cent to yield 1.369 percent.

The 10-year yield touched its highest since May 5 of 1.394 percent.

Investors are awaiting Canada's March retail sales data and April inflation data, set for release on Friday. ECONCA

Reporting by Fergal Smith; Editing by Bernadette Baum