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* Canadian dollar at C$1.0673 or 93.69 U.S. cents * Bond prices higher across the maturity curve By Leah Schnurr TORONTO, Jan 2 (Reuters) - The Canadian dollar softened against the greenback on Thursday as oil prices fell, kicking off a new year that is expected to bring more weakness for the currency. With some investors still on holiday, trading was choppy in thinner-than-usual markets. Earlier in the day, the loonie strengthened to as much as C$1.0589 against the U.S. currency before giving up its gains. The Canadian dollar enters 2014 with many investors expecting the currency to weaken in the first few months of the year as the Bank of Canada maintains a more dovish policy stance and as the Federal Reserve gradually winds down its U.S. economic stimulus program. "As we get back to the data and Fed watching, discussions around tapering will come back to the forefront and the Canadian dollar may again get pushed lower as focus shifts to better U.S. economic performance and the retraction from quantitative easing," said Don Mikolich, executive director of foreign exchange sales at CIBC World Markets in Toronto. The Canadian dollar ended the North American session at C$1.0673 to the greenback, or 93.69 U.S. cents. The U.S. dollar was up 0.7 percent against a basket of currencies. The Bank of Canada's official close for the Canadian currency on Tuesday, ahead of Wednesday's New Year's Day holiday, was C$1.0636, or 94.02 U.S. cents. U.S. crude prices settled down $2.98 at $95.44 a barrel as Libya prepared to restart a major oilfield. Over the last 10 years, the Canadian dollar has ended January softer than where it started eight times, with an average loss of 0.6 percent, said Camilla Sutton, chief currency strategist at Scotiabank in Toronto. "A fairly clear seasonal pattern for January," Sutton said. "Certainly this year that would be in line with where our forecasts are." Sutton expects the Canadian dollar to weaken over the next six months before stabilizing in the second half of the year as a stronger U.S. economic recovery benefits Canada. A weaker loonie should also aid the Canadian economy. Data showed global manufacturing ended 2013 on a strong note, though China's growth remained modest. At home, growth in Canada's manufacturing sector pulled back to a fourth-month low last month. Canadian government bond prices were higher across the maturity curve, with the two-year up 1-1/2 Canadian cents to yield 1.127 percent and the benchmark 10-year up 28 Canadian cent to yield 2.738 percent.