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CANADA FX DEBT-Loonie dips with oil but stays in reach of 2-1/2-month high

    * Canadian dollar dips 0.1% against the greenback
    * Canada's current account deficit widens to C$11.1 billion
    * Price of U.S. oil decreases 0.6%
    * Canadian bond yields were mixed across the curve

    TORONTO, May 28 (Reuters) - The Canadian dollar edged lower
against its U.S. counterpart on Thursday as oil prices fell and
data showed a widening in Canada's current account deficit, but
the loonie stayed within reach of a 2-1/2-month high.
    The price of oil, one of Canada's major exports, fell as the
market awaited confirmation of industry data that showed a
surprise increase in U.S. crude stocks. U.S. crude        prices
were down 0.6% at $32.61 a barrel.                      
    Canada's current account deficit widened to C$11.1 billion 
in the first quarter from a revised C$9.3 billion deficit in the
fourth quarter, on a higher trade in goods and services deficit,
Statistics Canada said.             
    A wider current account deficit could leave the loonie more
sensitive to moves in the global flow of capital.
    Shares globally          rose as businesses returning to
work and a 750 billion euro EU stimulus plan outweighed rising
U.S.-China tensions.             
    The Canadian dollar        was trading 0.1% lower at 1.3765
to the greenback, or 72.65 U.S. cents. The loonie, which on
Wednesday touched its strongest in two-and-a-half months at
1.3723, traded in a range of 1.3734 to 1.3789.    
    Canada's GDP report for the first quarter is due on Friday
which could help guide expectations for next week's Bank of
Canada interest rate decision, when Tiff Macklem will be in
place as the central bank's new governor.
    Canadian government bond yields were mixed across the curve,
with the 10-year             up less than a basis point at
0.554%.    

 (Reporting by Fergal Smith; Editing by Andrea Ricci)
  
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