* C$ at C$1.0595 vs US$, or 94.38 U.S. cents
* Bond prices mixed across the maturity curve
By Leah Schnurr
TORONTO, Nov 28 (Reuters) - The Canadian dollar was flat in
quiet trade against the greenback on Thursday, hovering just
below four-month lows as a number of fundamental factors
suggested the outlook for the currency was still a weak one.
Trading was expected to be muted with U.S. bond and stock
markets closed for the Thanksgiving holiday.
The only domestic news on the docket for Thursday was a
report on Canada's current account deficit, which shrank in the
third quarter, though the second-quarter deficit was
substantially larger than previously reported.
The deficit fell to C$15.47 billion ($14.59 billion) in the
third quarter from C$15.92 billion in the second, which was
revised from C$14.58 billion.
Analysts had forecast a third-quarter deficit of C$14.4
billion.
The loonie saw little reaction to the data.
"When it's quiet like that, it's always vulnerable to
awkward movements just because of the reduced liquidity,
particularly with just Canada being open for North America,"
said Camilla Sutton, chief currency strategist at Scotiabank in
Toronto.
The Canadian dollar was at C$1.0595 to the
greenback, or 94.38 U.S. cents, unchanged from Wednesday's
close. The loonie hit C$1.0603 on Wednesday, its lowest level
since early July.
The Canadian currency has lost about 3 percent since late
October, hurt by a retreat in the Bank of Canada's hawkish tilt
and expectations that the Federal Reserve will soon move to
withdraw its monetary stimulus.
After the Fed surprised markets in September by holding the
pace of its $85 billion a month in bond purchases steady,
investors are trying to gauge whether the U.S. central bank will
begin to wind down its bond buying at its next meeting in
December or wait until next year.
At the same time, the policy shift from the Bank of Canada
has markets expecting interest rates will stay at 1 percent into
2015.
"We have the Canadian dollar weakening modestly over the
next six months ... and then it starts to retrace that move in
the second half of next year," said Sutton.
With little action expected on Thursday, investors will be
turning their attention to Friday's domestic gross domestic
product reading. The economy is forecast to have grown at a 2.5
percent annualized rate in the third quarter.
The two-year bond was up 1 Canadian cent to yield
1.093 percent, while the benchmark 10-year bond was
off 2 Canadian cents to yield 2.547 percent.