November 19, 2018 / 8:59 PM / a month ago

CANADA FX DEBT-C$ edges lower as trade tensions weigh on risk assets

    * Brent crude slips as investors fear another glut
    * Traders focused on Canadian CPI, retail data due later
this week

 (Adds comment, updates market action)
    By Saqib Iqbal Ahmed
    Nov 19 (Reuters) - The Canadian dollar edged lower against
its U.S. counterpart on Monday, straying close to the nearly
four-month low touched last week, as trade tensions between the
United States and China continued to weigh on investors' risk
appetite.
    Deep divisions on trade between Washington and Beijing were
evident at the Asia-Pacific Economic Cooperation summit, with
leaders on Sunday failing to agree on a communique for the first
time in their history.             
    U.S. Vice President Mike Pence said in a blunt speech on
Saturday that there would be no end to U.S. tariffs on $250
billion of Chinese goods until China changed its ways.
    "The Canadian dollar is still very much leveraged to global
demand," said Bipan Rai, North America Head, FX strategy at CIBC
Capital Markets.
    "If we see hostilities continue to rise between the United
States and China, especially after next week's G20 meeting
between President (Donald) Trump and Chairman Xi (Jinping), then
that could be something that weighs on global demand and by
extension on currencies leveraged to global demand, including
the Canadian dollar," Rai said.
    The Canadian dollar also came under pressure on Monday as
worries about growing supply of crude weighed on the price of
oil.             
    Traders were also focused on this week's domestic event
calendar, which features public appearances by Carolyn Wilkins,
senior deputy governor at the Bank of Canada, and Bank of Canada
Deputy Governor Timothy Lane, ahead of CPI and retail sales data
due on Friday.
    At 3:45 p.m. (2045 GMT), the Canadian dollar          was
trading down about 0.3 percent against the greenback, at 1.3180
or 75.87 U.S. cents. On Wednesday, the currency hit its weakest
level since July 20 at 1.3264.
    Canadian government bond yields were lower on the day, with
the yield on the 10-year             at 2.353 percent. 

 (Reporting by Saqib Iqbal Ahmed
Editing by Susan Thomas and Sandra Maler)
  
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