* Canadian dollar rises 0.2% against the greenback * Canada's annual inflation rate falls to 2.0% in June * U.S. oil futures increase by 0.3% * Canada's 10-year yield touches a nine-day low at 1.550% By Levent Uslu TORONTO, July 17 (Reuters) - The Canadian dollar gained against the greenback on Wednesday, paring some of the previous day's decline, as oil prices rose and domestic data supported the view that the economy is recovering after a slow patch at the turn of the year. At 10:29 a.m. (1429 GMT), the Canadian dollar was trading 0.2% higher at 1.3069 to the greenback, or 76.52 U.S. cents. The currency, which has pulled back from a near nine-month high last Friday at 1.3018, traded in a range of 1.3053 to 1.3093. Lower energy prices helped push down Canada's annual inflation rate in June to 2.0% from 2.4% in May, while factory sales rose by 1.6% in May, the most in a year, data from Statistics Canada showed. "I think the narrative that we've been talking about is still broadly in place, that growth in Canada is bouncing back after a soft winter and inflation pressures are still right around 2%," said Nathan Janzen, a senior economist at Royal Bank of Canada. "I think it's fair to say that the Canadian manufacturing sector has held up a little better than say the U.S. manufacturing sector has year-to-date," Janzen said. Meanwhile, the price of oil, one of Canada's major exports, rose after a sharp decline on Tuesday. U.S. crude oil futures were up 0.3% at $57.80 a barrel. Canadian government bond prices were higher across the yield curve in sympathy with U.S. Treasuries after data showed weakness in the U.S. housing market and as concerns about the trade war between the United States and China boosted demand for safe haven debt. The two-year rose 1 Canadian cent to yield 1.556% and the 10-year was up 17 Canadian cents to yield 1.568%. The 10-year yield touched its lowest intraday since July 8 at 1.550%. (Reporting by Levent Uslu; additional reporting by Fergal Smith Editing by Marguerita Choy)
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