*
Canadian dollar weakens 0.2% against the greenback
*
Touches its strongest since Feb. 14 at 1.3303
*
Canadian home sales rise 1.4% in March
*
10-year yield touches its highest since March 10
TORONTO, April 14 (Reuters) - The Canadian dollar weakened against its U.S. counterpart on Friday as hawkish comments by a Federal Reserve official bolstered the greenback against a basket of major currencies, but the loonie remained on track for a weekly gain. Canada's currency has been supported in recent days by a smaller gap between the yields of U.S. and Canadian bonds as signs of cooling U.S. inflation raised expectations for an imminent end to the Fed's interest rate-hike cycle. But on Friday, Fed Governor Christopher Waller said that despite a year of aggressive rate increases, U.S. central bankers "haven't made much progress" in returning inflation to their 2% target and need to move rates higher still.
The Canadian dollar was trading 0.2% lower at 1.3360 to the greenback, or 74.85 U.S. cents, after earlier touching its strongest level since Feb. 14 at 1.3303. For the week, it was on track to advance 1.1%. Domestic data was mixed. Canadian home sales rose 1.4% in March from February, the second straight month of higher sales, while factory sales fell by 3.6% in February from January on lower sales for petroleum and coal products, as well as motor vehicles. U.S. equity markets seesawed as weak March retail sales data suggested the economy was losing steam, while upbeat earnings from a trio of big banks helped assuage fears of further stress in the sector. The banking stress in the United States and Europe has had a limited impact on Canada's financial system so far, Bank of Canada Governor Tiff Macklem said on Thursday, one day after the central bank left its benchmark rate unchanged for a second straight policy meeting at 4.50%. The Canadian 10-year rose 7.8 basis points to 3.049%, its highest level since March 10, tracking a move higher in U.S. Treasury yields. (Reporting by Fergal Smith; editing by Jonathan Oatis)
