CANADA FX DEBT-C$ pares weekly advance, hindered by ''fragile'' investor sentiment

    (Adds strategist quotes and details throughout; updates prices)
    * Canadian dollar falls 0.1% against the greenback
    * Advance results for September manufacturing sales show
1.5% rise
    * Loonie advances 0.4% for the week
    * Canada's 10-year yield eases 1.5 basis points to 0.643%

    By Fergal Smith
    TORONTO, Oct 23 (Reuters) - The Canadian dollar edged lower
against its U.S. counterpart on Friday as oil prices fell and
investors weighed prospects for a U.S. coronavirus relief
package, with the loonie giving back some of this week's gain.
    The Canadian dollar        was trading 0.1% lower at 1.3140
to the greenback, or 76.10 U.S. cents, having traded in a range
of 1.3109 to 1.3160. For the week, the loonie was up 0.4%.
    "The CAD has made modest progress against a generally softer
USD this week but the broader (market) backdrop is unsettled,"
Scotiabank strategists, including Shaun Osborne, said in a note.
    "The broader risk backdrop appears fragile following
September's big reversal in stocks and with U.S. equities
perhaps vulnerable as U.S. lawmakers dither on fiscal stimulus,"
the strategists said.
    Wall Street's main indexes seesawed as investors fretted
over an impasse in Washington on the new coronavirus aid bill,
while turning cautious ahead of the Nov. 3 presidential
election.
    Canada sends about 75% of its exports to the United States,
including oil. U.S. crude oil futures        settled 1.6% lower
at $41.77 a barrel, while the U.S. dollar        fell against a
basket of major currencies, including the euro, after data
showed Germany's manufacturing sector expanding at a faster
rate.
    Canadian manufacturing sales last month most likely rose by
1.5% after falling 2.0% in August, Statistics Canada said in a
flash estimate. A separate flash estimate showed wholesale sales
increasing by 0.4% after rising 0.3% in August.

    The Bank of Canada is due to update its economic outlook
next week.
    Canadian government bond yields eased across the curve in
sympathy with U.S. Treasuries on Friday. The 10-year
fell 1.5 basis points to 0.643%, pulling back from an earlier
eight-week high at 0.680%.

 (Reporting by Fergal Smith; Editing by Andrea Ricci and Chizu
Nomiyama)

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