* Canadian dollar at C$1.3257, or 75.43 U.S. cents
* Bond prices higher across the maturity curve
(Updates prices, adds quote)
TORONTO/OTTAWA, Sept 14 (Reuters) - The Canadian dollar was
little changed against the greenback on Monday, trading within a
narrow range with the U.S. Federal Reserve due to make a highly
anticipated interest rate decision later this week.
The Fed had been indicating it planned to hike rates at some
point this year, but recent worries about global growth and
lackluster Chinese economic data have increasingly raised the
possibility that it may delay a rate hike until 2016.
A Reuters poll last week showed a small majority of
forecasters still expect the U.S. central bank to announce a
rate hike at the end of its two-day policy meeting on Thursday,
though markets-based models suggest the monetary policy
tightening will be delayed. It would be the first rate increase
in nearly a decade.
After losing about 14 percent this year so far, the Canadian
dollar has been consolidating in recent weeks and movement was
subdued on Monday.
"It does seem like everybody is just sitting on their hands,
said Amo Sahota, director at Klarity FX in San Francisco.
But it would be a mistake for traders to simply wait for the
Fed, with some potentially market moving events coming before
then, including a rate decision from the Bank of Japan, and
minutes and testimony from the Reserve Bank of Australia, Sahota
said.
The Canadian dollar ended the North American
session at C$1.3257 to the greenback, or 75.43 U.S. cents,
little changed from the Bank of Canada's official close of
C$1.3254, or 75.45 U.S. cents.
While it is difficult to predict which way the loonie will
trade in the aftermath of the Fed decision, a move to raise
rates could support the Canadian dollar in the medium term as it
would suggest a continuing U.S. recovery that should bolster
Canada's economy, Sahota said.
"If they give some really solid guidance that we think the
destabilization in China with the devaluation and slower growth
that they're seeing is not really impactful for the U.S., that's
good news for Canada," he said.
Canadian government bond prices were higher across the
maturity curve, with the two-year price up half a
Canadian cent to yield 0.456 percent and the benchmark 10-year
up 6 Canadian cents to yield 1.467 percent.
The Canada-U.S. two-year bond spread was -27.4 basis points,
while the 10-year spread was -72.2 basis points.
(Reporting by Solarina Ho in Toronto and Leah Schnurr in
Ottawa; Editing by Cynthia Osterman)