CANADA FX DEBT-Canadian dollar steadies as BoC minutes reveal split on rate outlook

By Fergal Smith

TORONTO, Aug 13 (Reuters) - The Canadian dollar was barely changed against its U.S. counterpart on Wednesday, as oil prices fell and minutes from the Bank of Canada's latest policy decision showed that policymakers were split on the need for additional interest rate cuts.

The loonie CAD= was trading nearly unchanged at 1.3770 per U.S. dollar, or 72.62 U.S. cents, after moving in a range of 1.3752 to 1.3782.

Deliberations of the Bank of Canada's Governing Council in July, when the benchmark rate was left unchanged at 2.75%, showed that the central bank was divided on how much monetary policy could aid growth under current economic conditions that are shaped by U.S. tariffs.

"There's a split in the Governing Council, with some members believing that rates may not need to fall further," Benjamin Reitzes, Canadian rates & macro strategist at BMO Capital Markets, said in a note. "Other members highlighted that persistent slack and ongoing labour market softness could warrant further easing."

Investors see a 33% chance that the BoC eases at the next policy decision on September 17. That's up from 17% at the start of the month, after expectations rose that the Federal Reserve would resume its easing campaign and the release of weaker-than-expected domestic jobs data. 0#CADIRPR

The price of oil CLc1 settled 0.8% lower at $62.65 a barrel after U.S. crude supply unexpectedly rose. Oil is one of Canada's major exports.

In a potential blow to Canada's economy, Air Canada AC.TO is cancelling flights from Thursday. The country's largest carrier is winding down service ahead of a looming Saturday strike by its more than 10,000 flight attendants.

Canadian bond yields moved lower across the curve, tracking moves in U.S. Treasuries. The 10-year CA10YT=RR was down 4.7 basis points at 3.388%.