* Canadian dollar at C$1.0948 or 91.34 U.S. cents * Focus on central bank Jan. 22, dovish expectations * Bond prices mostly lower across the maturity curve By Andrea Hopkins TORONTO, Jan 14 The Canadian dollar continued to weaken on Tuesday, falling to a fresh four-year low against its U.S. counterpart as investors remained concerned ahead of next week's Bank of Canada interest rate decision and policy statement. With the currency flirting with the psychologically important C$1.10 level, traders said momentum remained against the commodity-linked Canadian dollar after weak economic data last week and concern about next week's central bank meeting. "We got to a new low today, which suggests there is ongoing downward momentum on the Canadian dollar," said Camilla Sutton, chief currency strategist at Scotiabank. "It is ... based on everything from a fundamental shift after disappointing data last week, ongoing positioning to be short Canada, the outlook for the Bank of Canada on the 22nd and expectations that Governor Poloz will continue to sound very dovish." The Canadian dollar ended the North American session at C$1.0948 to the greenback, or 91.34 U.S. cents, well below Monday's North American close at C$1.0846 to the greenback, or 92.20 U.S. cents. It fell as far as C$1.0960, the currency's weakest level since October 2009, passing the nadir reached on Friday after the Canadian government released a dismal December employment report. The jobs report fueled expectations the Bank of Canada will maintain its recent dovish stance, one of the factors that is seen keeping pressure on the loonie in 2014. The dollar also sagged after Canada's junior finance minister, Kevin Sorenson, said Tuesday the country's manufacturing sector was happy with the weaker currency, adding that it presented "remarkable opportunities." Scotiabank's Sutton said a drop to the C$1.10 level would be a significant development, particularly for exporters who had struggled to compete when the Canadian dollar was at parity, and often stronger, than the U.S. currency. "C$1.10 is psychologically very important, it's a very key whole number - a full 10 cents away from parity, which is a big deal if you are an exporter... a 10 percent depreciation in CAD since parity really does shift the economics for Canadian exporters," Sutton said. Canadian government bond prices were mostly lower across the maturity curve, with the two-year bond down 4 Canadian cents to yield 1.057 percent and the benchmark 10-year down 26 Canadian cents to yield 2.577 percent.