* C$ hits day's high and low after Fed statement
* Fed says prepared to provide additional support
* Bonds follow U.S. Treasuries higher (Adds comments after Fed statement)
TORONTO, Sept 21 (Reuters) - The Canadian dollar hit its highest and lowest points of the session against the U.S. currency on Tuesday after the U.S. Federal Reserve said it stood ready to help the economy if needed.
The Fed, which made no shift in monetary policy at the end of its one-day meeting, as expected, said it was prepared to provide additional support to bolster a modest economic recovery, suggesting it may be preparing to do more to keep unemployment from rising and prices from falling. [ID:nN20109053]
The currency briefly dropped to C$1.0332 to the U.S. dollar, or 96.79 U.S. cents, then turned convincingly higher as investors exited the greenback, while U.S. stock indexes turned positive. It jumped as high as C$1.0217 to the U.S. dollar, or 97.88 U.S. cents.
"The market is diversifying away from the U.S. dollar as far as a safety holding and we saw immediate evidence of that with the way that the Dow shot up and interest for the other currencies took place," said said C.J. Gavsie, managing director of foreign exchange sales at BMO Capital Markets.
At 3:25 p.m. (1725 GMT), the currency was at C$1.0261 to the U.S. dollar, or 97.46 U.S. cents, up from Monday's close at C$1.0293, or 97.15 U.S. cents.
Government bonds were initially mixed after the statement, but climbed across the curve to mirror gains in U.S. Treasuries as the Fed expressed somewhat greater concern about the sluggish pace of economic growth.
The U.S. central bank also opened the door wider to pumping more money into the economy as well as noting that it saw subdued inflation for "some time."
The two-year bond was up 9 Canadian cents to yield 1.462 percent, while the 10-year bond gained 21 Canadian cents to yield 2.920 percent. (Reporting by Ka Yan Ng; editing by Rob Wilson)
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