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CANADA FX DEBT-Canadian dollar slides to 2-week low as coronavirus spreads

    * Canadian dollar falls 0.5% against the greenback
    * Canadian wholesale trade rises 0.9% in December
    * Price of U.S. oil tumbles 4.7%
    * Canadian bond yields decline across a flatter yield curve

    TORONTO, Feb 24 (Reuters) - The Canadian dollar weakened to
a near two-week low against its U.S. counterpart on Monday as
spreading of the coronavirus epidemic outside of China worried
investors, overshadowing a bigger-than-expected gain for
domestic wholesale trade.        
    Europe's share markets suffered their biggest slump since
mid-2016, as a jump in coronavirus cases in Italy, South Korea,
Japan and Iran sent investors scrambling to the security of gold
and government bonds.             
    Canada is a major exporter of commodities, including oil, so
its economy could be hurt if spreading of the virus were to slow
global economic growth. U.S. crude oil futures        were down
4.7% at $50.87 a barrel.
    Canadian wholesale trade increased by 0.9% in December from
November on stronger sales in the motor vehicles and motor
vehicle parts and accessories subsector, Statistics Canada said.
Analysts had forecast a 0.5% increase.             
    Canada's GDP reports for December and for the fourth quarter
are due on Friday. Last month, the Bank of Canada opened the
door to an interest rate cut should a recent slowdown in
domestic growth persist.                       
    At 9:26 a.m. (1426 GMT), the Canadian dollar          was
trading 0.5% lower at 1.3287 to the greenback, or 75.26 U.S.
cents. The currency, which was up 0.2% last week, hit its
weakest intraday level since Feb. 11 at 1.3308.
    Speculators have cut their bullish bets on the Canadian
dollar to the lowest since October, data from the U.S. Commodity
Futures Trading Commission and Reuters calculations showed on
Friday. As of Feb. 18, net long positions had fallen to 7,817
contracts from  9,705 in the prior week.
     Police moved in on Monday morning to clear a rail blockade
by an indigenous group in eastern Canada that had been stopping
freight and passenger traffic for more than two weeks on one of
the country's busiest lines.
    Canadian miner Teck Resources Ltd            has withdrawn
an application to build its C$20.6 billion Frontier oil sands
mine in Alberta, days before the federal government was to
decide on whether to approve the project, opposed by
environmentalists and indigenous groups.                    
    Canadian government bond yields were lower across a flatter
yield curve in sympathy with U.S. Treasuries. The 10-year yield
            fell 9.3 basis points to 1.188%, having touched its
lowest intraday level since Sept. 5, last year at 1.183%.    

 (Reporting by Fergal Smith)
  
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