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CANADA FX DEBT-Loonie falls on rising global political tensions

By Levent Uslu

(Adds strategist quote and details; updates prices) * Canadian dollar falls 0.1% against the greenback * U.S. oil prices increase 0.8% * Bond prices move higher across the yield curve By Levent Uslu TORONTO, Aug 12 (Reuters) - The Canadian dollar edged lower against its U.S. counterpart on Monday, giving up some gains from the last two sessions, as increased global political tensions stir investor worries about risky currencies like the loonie. At 3:55 p.m. (1955 GMT), the Canadian dollar was trading 0.1% lower at 1.3239 to the greenback, or 75.53 U.S. cents. The currency was trading in a range of 1.3207 to 1.325. Because Canada exports many commodities, including oil, its economy faces the risk of being hurt by escalating geopolitical tensions that could threaten global growth and commodities prices. "Markets are concerned about Hong Kong and Argentina ... so high-risk, growth-sensitive currencies like the Mexican peso, Australian dollar and Norwegian krone are all weakening, and the Canadian dollar is also soft, although to a lesser extent than its peers," said Eric Theoret, a currency strategist at Scotiabank. Argentine voters signaled they could reject market-friendly President Mauricio Macri at an election in October and return the country to interventionist economics. Hong Kong's airport halted flights on Monday, blaming demonstrators for the disruption, while China said the anti-government protests that have swept the city over the past two months had begun to show "sprouts of terrorism." Meanwhile, the price of oil, one of Canada's major exports, was little changed as expectations that major producers would continue to reduce global supplies ran into worries about sluggish growth in crude demand due to the U.S.-China trade war. U.S. crude oil futures settled 0.8% higher at $54.93 a barrel. Canadian government bond prices were higher across the yield curve in sympathy with U.S. Treasuries. The two-year rose 10.5 Canadian cents to yield 1.332% and the 10-year was up 73 Canadian cents to yield 1.198%. (Reporting by Levent Uslu Editing by Leslie Adler)