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Canadian dollar gains 0.2% against the greenback

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Carney picks former banker for natural resources

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Price of U.S. oil settles 2.8% higher

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Bond yields rise across a steeper curve

By Fergal Smith

TORONTO, May 13 (Reuters) - The Canadian dollar

recovered from a one-month low against its U.S. counterpart on

Tuesday as the greenback weakened broadly and investors

applauded some of Canadian Prime Minister Mark Carney's cabinet

choices.

The loonie was trading 0.2% higher at 1.3950 per U.S.

dollar, or 71.68 U.S. cents, after touching its weakest intraday

level since April 10 at 1.4016.

Carney unveiled a new cabinet that he said would help define

a new relationship with Washington. Former Goldman Sachs banker

Tim Hodgson was named natural resources minister.

"Mark Carney campaigned on building and his choice for

natural resources shows that he is serious about building

resources in Canada," said Adam Button, chief currency analyst

at ForexLive.

"I think it's the most important cabinet pick today. ...

It's a great signal for the loonie."

Carney, whose Liberal Party won last month's general

election, has said that Canada must spend billions to start

shifting the economy's focus away from the United States as well

as end barriers to internal trade and cut public spending.

Canada is a major producer of natural resources, including

oil. Oil settled 2.8% higher at $63.67 a barrel,

continuing to benefit from easing U.S.-China trade tensions.

"The market is feeling much better about global growth in

light of the climb down in the U.S.-China trade war," Button

said.

The U.S. dollar gave back some of Monday's rally

against a basket of major currencies after data showed U.S.

consumer prices increased less than expected last month.

Canadian bond yields rose across a steeper curve, tracking

moves in U.S. Treasuries. The 10-year was up 2.2

basis points at 3.231%.