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Loonie touches its weakest since February 6 at 1.3714

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Trade deficit narrows to C$1.31 billion in December

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Price of oil settles 1.9% higher

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Bond yields were little changed across the curve

By Fergal ​Smith

TORONTO, Feb 19 (Reuters) - The Canadian dollar steadied

after ‌six straight days of declines against its U.S. counterpart

on Thursday as oil prices rose ⁠and data showed that Canada's

trade deficit narrowed in December.

The loonie was ⁠trading nearly unchanged at 1.37 per

U.S. dollar, or ‌72.99 U.S. cents, ‌after earlier touching its

weakest level since February 6 at 1.3714.

Canada's trade deficit narrowed to ​C$1.31 billion ($957

million) in December from a ‌revised C$2.59 billion in November,

as a jump in exports of unwrought gold helped lift total exports

by 2.6%.

For ​2025, exports edged down 0.2%, weighed ​by ‌reduced

exports to the United States after it began a trade war.

"Canada has thus far escaped the worst of the trade ⁠blow,"

Karl Schamotta, chief market strategist at Corpay, said in a

note. "But ⁠officials on both sides of the border are preparing

for acrimonious negotiations in the months ahead - and we think

(currency) hedgers should be doing the same."

The United States-Mexico-Canada Agreement, which has

shielded much of Canada's ⁠exports from ‌U.S. tariffs, is set for

review by a July ‌1 deadline.

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

settled 1.9% ⁠higher at $66.43 a barrel as traders worried about

escalating tensions between the United States and Iran, which

have stepped up military activity in the oil-producing Middle

East.

The safe-haven U.S. dollar added to recent gains

against a basket of major currencies after U.S. data indicated

the economy was stable, giving the Federal Reserve leeway ​to

hold interest rates in check.

Canadian bond yields were little changed across the curve.

The 10-year was down less than half a basis point ​at

3.226%, after touching on Tuesday ‌a near seven-week low at

3.204%.