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Loonie trades in a range of 1.4053 to 1.4083

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Price of U.S. oil settles 2% lower

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Canada's services PMI rises in November

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Bond yields fall across the curve

By Fergal Smith

TORONTO, Dec 4 (Reuters) - The Canadian dollar steadied

against its U.S. counterpart on Wednesday, keeping some distance

from a recent 4-1/2-year low, as oil prices fell and investors

continued to bet on a Federal Reserve interest rate cut this

month.

The loonie was trading nearly unchanged at 1.4065 per

U.S. dollar, or 71.10 U.S. cents, after trading in a range of

1.4053 to 1.4083.

Last month, the currency touched its weakest level since

April 2020 at 1.4177 as investors grappled with the threat of

U.S. trade tariffs.

Federal Reserve Chair Jerome Powell said the U.S. economy is

stronger than it had appeared in September when the central bank

began cutting interest rates, allowing policymakers to

potentially be more cautious in lowering rates further.

His remarks did little "to alter the market's view that the

Fed will likely trim rates on December 18," Sal Guatieri, a

senior economist at BMO Capital Markets, said in a note.

The price of oil, one of Canada's major exports,

settled 2% lower at $68.54 a barrel as traders awaited an

imminent OPEC+ decision on supply.

Canada's services economy expanded for a second straight

month in November as firms added staff, S&P Global's Canada

services PMI data showed. The headline business activity index

rose to 51.2 from 50.4 in October.

Still, investors expect the Bank of Canada to continue its

easing campaign at an interest rate decision next week, with the

market pricing in a roughly 50% chance of another unusually

large 50-basis-point move.

Canadian bond yields moved lower across the curve, tracking

moves in U.S. Treasuries. The 10-year was down 3.2

basis points at 3.086%.