CANADA FX DEBT-C$ notches 4-week high as oil rallies, greenback falls

* Canadian dollar at C$1.3174, or 75.91 U.S. cents
    * Loonie touches its strongest since Dec. 14 at C$1.3119
    * Bond prices mixed across the yield curve

    By Fergal Smith
    TORONTO, Jan 11 (Reuters) - The Canadian dollar strengthened
to a four-week high against its U.S. counterpart on Wednesday as
oil rallied and the greenback fell against a basket of major
currencies following a news conference by U.S. President-elect
Donald Trump.
    At 3:09 p.m. ET (2009 GMT), the Canadian dollar was
trading at C$1.3174 to the greenback, or 75.91 U.S. cents,
stronger than Tuesday's close of C$1.3227, or 75.60 U.S. cents.
    "It's potentially a watershed day for the Canadian dollar
because it has broken below the trend line since May ... and
that may signal big things for the Canadian dollar ahead," said
Adam Button, currency analyst at ForexLive.
    "To start the year there has been an incredible battle in
Canadian dollar trading between oil, which has been declining,
and Canadian economic news which has been sparkling. And with
oil bouncing back today it has cleared the way for an extended
Canadian dollar rally."
    Domestic data since the beginning of the year has shown a
December surge in jobs and the first trade surplus in more than
two years in November, while a Bank of Canada survey pointed to
improving business conditions.  
    The loonie's weakest level of the session was C$1.3295,
while it touched its strongest since Dec. 14 at C$1.3119.    
    Prices of oil, one of Canada's major exports, rose by the
most in over a month, helped by news that Saudi Arabia had cut
exports to Asia and a weaker U.S. dollar following
Trump's news conference.    
    Trump denounced unsubstantiated claims he had been caught in
a compromising position in Russia and attacked U.S. intelligence
agencies over the leak of the information. 
    He "didn't hint at any measures to stimulate near-term
growth and that's a disappointment," Button said.
    Canadian government bond prices were mixed across the yield
curve, with the two-year price down 1 Canadian cent
to yield 0.758 percent and the 10-year rising 1
Canadian cent to yield 1.681 percent.

 (Additional reporting by Alastair Sharp; Editing by Lisa Von
Ahn and Meredith Mazzilli)