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Canadian dollar falls 0.3% against the greenback

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Trades in a range of 1.3794 to 1.3848

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Price of oil settles 0.6% higher

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Bond yields rise across the curve

By Fergal Smith

TORONTO, Sept 9 (Reuters) - The Canadian dollar fell

against its U.S. counterpart on Tuesday, approaching the weakest

level since August, as an uncertain outlook for the Canadian

economy supported recent moves by investors to increase bearish

bets on the currency.

The loonie was trading 0.3% lower at 1.3845 per U.S.

dollar, or 72.23 U.S. cents, after moving in a range of 1.3794

to 1.3848. On Friday, the currency touched a 9-day low at

1.3854.

"This weakness is partially attributable to an increase in

net-short institutional positioning," said Kevin Ford, FX &

macro strategist at Convera.

"While Canada benefits from the CUSMA deal and has one of

the lowest effective tariff rates globally, tariffs on other

sectors and ongoing uncertainty about a new trade deal with the

U.S. continue to dampen the medium-term economic outlook."

Canadian employment data on Friday added to evidence that

uncertainty related to U.S. tariffs is taking a toll on Canada's

economy.

The vast amount of Canada's exports enter the U.S.

tariff-free under the Canada-United States-Mexico Agreement but

the continental trade pact is up for review in July next year.

The U.S. dollar fell against a basket of major currencies

as the preliminary annual benchmark revision estimate to the

closely watched U.S. payrolls data suggested a far weaker labor

market than was previously thought.

The price of oil, one of Canada's major exports, settled

0.6% higher at $62.60 a barrel after the Israeli military said

it carried out an attack on Hamas leadership in Qatari capital

Doha.

Canadian bond yields edged higher across the curve. The

10-year was up 1.6 basis points at 3.225%, after

touching on Monday a three-month low at 3.208%.