* C$ ends at C$0.9810 vs US$, or $1.0194 * Best weekly gain since early March; April gain 1.7 pct * Soft U.S. GDP data weakens greenback * Bank of Canada outlook supports * C$ long positions at highest since 2005 By Jon Cook TORONTO, April 27 (Reuters) - Canada's dollar hit a seven-month high against its U.S. counterpart on Friday and was on track for its best month this year after the greenback slid broadly on signs of flagging U.S. growth. First-quarter U.S. economic growth cooled as businesses cut back on investment and restocked shelves at a slower pace. The GDP data came on the heels of Thursday's disappointing U.S. jobless claims report, raising expectations that the Fed could launch another round of monetary easing, which would likely be negative for the greenback. "A generally weak U.S. dollar on the back of the GDP report leaves the door open to further dovishness from the Fed," said Camilla Sutton, chief currency strategist at Scotiabank. "The Canadian dollar has rallied a fair bit over the last few sessions." The latest sign of investor bullishness on the Canadian currency appeared in data from the Commodity Futures Trading Commission. It showed net long positions in the Canadian dollar rose to 44,224 contracts in the latest week, the highest level since the end of 2005, as currency speculators cut U.S. dollar positions, The Canadian dollar finished at C$0.9810 versus the U.S. dollar, or $1.0194, up from Thursday's finish at C$0.9840 against the greenback, or $1.0163. It touched a session high at C$0.98, its strongest level since Sept. 19. With one session left in April, the currency was up 1.7 percent and headed for its best monthly gain this year. It rose 1.1 percent on the week, its best showing since early March. The Canadian dollar shrugged off euro zone debt worries after Spain's credit rating suffered another downgrade and data on Friday revealed nearly 25 percent of the debt-ravaged nation's workforce is unemployed. Earlier this week Fed Chairman Ben Bernanke said the U.S. central bank "would not hesitate" to launch another round of bond purchases to drive borrowing costs lower if it looked like the economy needed it. By contrast, Bank of Canada Governor Mark Carney maintained the bank's "hawkish bias" when he addressed a business audience in Ottawa, said Sutton. Carney repeated his warnings about excess household debt as Canadians take out mortgages at extremely low borrowing rates, saying the country should heed the lessons of the U.S. housing crash. The Bank of Canada surprised investors earlier this month with a more positive Canadian economic outlook and explicit warning that it may have to start raising interest rates again. "The Bank of Canada turning a touch more hawkish has been driving a lot of that appreciation," said Charles St-Arnaud, Canadian economist and currency strategist at Nomura Securities International in New York. He added next week's U.S. non-farm payroll numbers would be watched closely as a further gauge of the strength of the American recovery effort. Canadian government bond prices were mostly lower. Canada's two-year bond fell 10 Canadian cents to yield 1.427 percent, while the benchmark 10-year bond dropped 35 Canadian cents to yield 2.092 percent.