*
Loonie trades in a range of 1.3403 to 1.3458
*
Canada’s trade deficit narrows in December
*
Price of U.S. oil increases 1%
*
10-year yield touches its highest since Jan. 11
TORONTO, Feb 7 (Reuters) - The Canadian dollar was little changed against its U.S. counterpart on Tuesday, with the currency holding near a two-week low as Canada posted a narrower trade deficit in December and ahead of a speech by the governor of the Bank of Canada.
Canada’s trade deficit narrowed to C$160 million ($119.20 million) in December from C$219 million in November as lower crude oil prices weighed on energy exports and imports of consumer goods fell.
U.S. crude oil prices prices were up 1% at $74.87 a barrel on Tuesday on optimism about recovering demand in China and concerns over supply shortages following the shutdown of a major export terminal after an earthquake in Turkey.
Bank of Canada Governor Tiff Macklem will speak on how monetary policy works. The central bank is due to release his prepared remarks at 12:30 ET (1730 GMT).
Last month, the BoC became the first major central bank to signal a pause in its tightening campaign after raising interest rates to a 15-year high of 4.50%.
The Canadian dollar was nearly unchanged at 1.3450 to the greenback, or 74.35 U.S. cents after trading in a range of 1.3403 to 1.3458.
On Monday, it touched its weakest since Jan. 20 at 1.3475 as Friday’s blockbuster U.S. jobs report raised expectations for more aggressive tightening by the Federal Reserve.
Canadian government bond yields were higher across the curve. The 10-year touched its highest since Jan. 11 at 3.095% before dipping to 3.073%, up 1.3 basis points on the day. (Reporting by Fergal Smith Editing by Nick Zieminski)
Our Standards: The Thomson Reuters Trust Principles.