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CANADA FX DEBT-C$ edges higher as U.S.-China trade commitment boosts sentiment

 (Adds analyst comments and details throughout, updates prices)
    * Canadian dollar advances 0.2% against the greenback
    * Loonie trades in a range of 1.3177 to 1.3239
    * Price of U.S. oil settles 1.7% higher
    * Canadian bond yields rise across a steeper curve

    By Fergal Smith
    TORONTO, Aug 25 (Reuters) - The Canadian dollar rose against
its broadly weaker U.S. counterpart on Tuesday, as oil prices
climbed and signs of calmer trade relations between the United
States and China bolstered investor sentiment.
    The loonie        was trading 0.2% higher at 1.3186 to the
greenback, or 75.84 U.S. cents. The currency, which on Monday
touched a four-month low intraday at 1.3130, traded in a range
of 1.3177 to 1.3239.
    The move higher had little to do with anything originating
in Canada, said Bipan Rai, North America head of FX strategy at
CIBC Capital Markets.
    "What's going on with stocks, with the broad U.S. dollar, I
think it is more of a reaction to that," Rai said.    
    Canada is a major exporter of oil and other commodities, so
the loonie tends to be sensitive to the global flow of trade and
capital.
    U.S. crude        prices settled 1.7% higher at $43.35 a
barrel, supported by production cuts in the U.S. Gulf Coast as
Tropical Storm Laura was forecast to become a major hurricane.
                
    Global shares          rose after the U.S. and China
reaffirmed their commitment to the Phase One trade deal agreed
in January, while the U.S. dollar        fell against a basket
of major currencies as better-than-expected German economic data
boosted the euro.                         
    The economic shock from the coronavirus pandemic will test
public confidence in the Bank of Canada's 2% inflation target,
Lawrence Schembri, a deputy governor at the central bank, said.
    Bank of Canada Governor Tiff Macklem is scheduled to
participate in a Federal Reserve Bank of Kansas City panel
discussion on Thursday.
    Canadian government bond yields were higher across a steeper
curve in sympathy with U.S. Treasuries on Tuesday. The 10-year
yield             rose 3.2 basis points to 0.593%, after hitting
on Monday its lowest intraday level in nearly two weeks at
0.532%.

 (Reporting by Fergal Smith; Editing by Bernadette Baum and
Grant McCool)
  
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