CANADA FX DEBT-Canadian dollar steadies near six-month low ahead of BoC rate decision

* Loonie touches its weakest since December 4 at 1.3969

* Trade surplus widens to C$2.72 billion

* Price of oil settles 3.4% lower

* Canadian bond yields ease across the curve

By Fergal Smith

TORONTO, June 9 (Reuters) - The Canadian dollar steadied near its lowest level this year against the U.S. dollar after data showed that Canada's trade surplus widened in April and ahead of a Bank of Canada interest rate decision.

The loonie was trading nearly unchanged at 1.3950 per U.S. dollar, or 71.68 U.S. cents, after touching its weakest intraday level since December 4 at 1.3969. Canada's goods trade surplus rose to a 15-month high of C$2.72 billion ($1.95 billion) in April, in part because the Iran war has pushed up the price of crude. Total exports increased 1.6% to reach a record high of C$75.16 billion.

"Recent trade data suggest that Canadian exports have largely recovered back to pre-2025 levels, albeit still with some weakness in sectors hit hardest by U.S. tariffs," Andrew Grantham, a senior economist at CIBC Capital Markets, said in a note.

"However, with tariff uncertainty remaining as CUSMA renegotiations drag on, further upward momentum will likely be limited in the near-term."

The United States-Mexico-Canada Agreement - known as CUSMA in Canada - has shielded much of the nation's exports from U.S. tariffs. It's set for review by a July 1 deadline.

Investors expect the Bank of Canada to leave its benchmark interest rate on hold at 2.25% for a fifth straight policy decision on Wednesday, as the central bank takes stock of slower economic growth and the threat to the inflation outlook of higher energy prices. The price of oil settled 3.4% lower at $88.20 a barrel after Iran and Israel said they had halted attacks on each other.

Canadian bond yields eased across the curve, tracking moves in U.S. Treasuries. The 10-year was down 3.4 basis points at 3.496%. (Reporting by Fergal Smith; Editing by Cynthia Osterman)