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%.
Reporting by Fergal Smith; editing by Jonathan Oatis and Alistair Bell
