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* C$ pares gains as US GDP falls 6.3 pct
* Currency stuck in C$1.22-C$1.24 range, underperforms kiwi
* Long bonds up ahead of supply, short debt dips on stocks
TORONTO, March 26 (Reuters) - The Canadian dollar was slightly higher versus the U.S. currency on Thursday as strength in equity markets and the rising price of oil lent support.
At 9:45 a.m. (1345 GMT), the Canadian currency was at C$1.2272 to the U.S. dollar, or 81.49 U.S. cents, up from C$1.2285 to the U.S. dollar, or 81.40 U.S. cents, at Wednesday's close.
The currency weakened overnight as low as C$1.2329 to the U.S. dollar, or 81.11 U.S. cents, but turned higher as North American equity markets pointed to a higher open on hope that recent upbeat U.S. economic data means the economy is stabilizing.
The currency briefly pared gains after data on Thursday showed the U.S. economy contracted slightly more than had been estimated in the fourth quarter. [ID:nN25435810]
U.S. gross domestic product fell at an annual rate of 6.3 percent in the October-December quarter, compared with last month's estimate of a 6.2 percent decline. Analysts had forecast fourth-quarter GDP would contract by 6.5 percent.
"The markets are assessing whether the worse has passed in terms of U.S. growth," said Paul Ferley, assistant chief economist at Royal Bank of Canada. "Data today clearly indicated fairly sizable declines in growth in the fourth quarter of last year but the expectations are that it was the weakest point in the current recession."
A renewed rise in the price of crude oil, up nearly 3 percent to above $54 a barrel, supported the Canadian dollar. Canada is a major exporter of oil.
The currency has taken direction from equity and commodity markets lately, considering them a barometer of risk sentiment, but it has not strayed out of a C$1.22-C$1.24 range against the U.S. dollar all week.
The Canadian dollar's gains paled in comparison to its commodity-linked cousin, the New Zealand dollar, which surged 2 percent to its highest level in more than two months on Thursday as investors searching for yield took the view that interest rates in New Zealand were at, or very near, the bottom. [ID:nN26335480]
Canadian government bonds were mixed with short-dated issues dipping due to strength in stocks, while long bonds edged up after being hammered in the past few sessions.
Prices were largely influenced by equity markets, but increasing U.S. supply was also factor, Ferley said.
The gains and losses were fairly modest as concern about lack of demand for more U.S. supply weighed, the day after the lukewarm reception at a five-year debt auction. The market faces a $24 billion sale of U.S. seven-year notes on Thursday.
The two-year bond fell 2 Canadian cents to C$100.10 to yield 1.203 percent. The 10-year bond inched up 2 Canadian cents to C$106.97 to yield 2.951 percent.
The 30-year bond rose 10 Canadian cents to C$122.15 to yield 3.724 percent. The U.S. 30-year bond yielded 3.743 percent. (Reporting by Ka Yan Ng; editing by Peter Galloway)