UPDATE 1-Cenovus cuts full-year spending forecast, boosts dividend

(Adds details on five-year plan, background)

Oct 2 (Reuters) - Oil and gas producer Cenovus Energy Inc on Wednesday lowered its spending forecast for the year and said will raise its quarterly dividend, as it focuses on giving more money back to shareholders.

The company said its capital budget for 2019 is now forecast to be between C$1.1 billion ($830.25 million) and C$1.2 billion, about C$150 million lower than the midpoint of its previous forecast.

Oil and gas companies have been pressed hard by investors to scale back spending and show more returns, clean up their balance sheets and boost cash flow as oil prices remain volatile with ongoing global trade uncertainties.

Cenovus said its five-year plan will focus on growing its cumulative free funds flow to C$11 billion, while increasing production by 2% to 3% per year.

The Calgary-based company raised its quarterly dividend by 25% to 62.5 Canadian cents per share, and said it has the capacity to increase it further at a rate of 5% to 10% annually. ($1 = 1.3249 Canadian dollars) (Reporting by Shariq Khan in Bengaluru; Editing by Shounak Dasgupta)