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CANADA FX DEBT-C$ holds near 6-week low amid escalating trade tensions

* Canadian dollar trades near flat against the greenback

* U.S. oil prices increase by 0.4%

* Bond prices move higher across the yield curve

TORONTO, Aug 6 (Reuters) - The Canadian dollar was little changed against its U.S. counterpart on Tuesday, with the currency hovering near a six-week low it hit on Friday as investors worried about rising trade tensions between the United States and China. A yearlong U.S.-China trade war has boiled over as Washington accused Beijing of manipulating its currency after China let the yuan drop to its lowest point in more than a decade. Canada exports many commodities, including oil, so its economy could be hurt by an escalation of trade tensions.

At 10:06 a.m. (1406 GMT), the Canadian dollar was

trading nearly unchanged at 1.3222 to the greenback, or 75.63 U.S. cents. The currency traded in a range of 1.3188 to 1.3236. On Friday, the currency hit its lowest intraday since June 20 at 1.3265. The loonie's six-week low on Friday came as data showed Canadian exports fell by 5.1% in June, the first drop since February. Meanwhile, the price of oil rebounded slightly on Tuesday from big falls in recent sessions amid escalating trade

tensions. U.S. crude oil futures were up 0.4% at $54.88 a

barrel. Canadian government bond prices were higher across the yield

curve, with the two-year up 16 Canadian cents toyield 1.377% and the 10-year rising 83 Canadian

cents to yield 1.289%. The gap between Canada's 2-year yield and its U.S. equivalent narrowed by 9.6 basis points to a spread of 22.2 basis points in favor of the U.S. bond, the narrowest gap since July 8.

(Levent Uslu; editing by Jonathan Oatis)