* C$ edges up to $1.0128
* Healthy fundamentals provide support
* Volumes light due to U.S. holiday
By Claire Sibonney
TORONTO, Jan 17 (Reuters) - The Canadian dollar firmed slightly against the greenback on Monday, holding well above parity on the back of its healthy fundamentals, with trading volumes light due to a U.S. holiday.
At 9:15 a.m. (1415 GMT), the currency was at C$0.9874 to the U.S. dollar, or $1.0128, up from Friday's North American finish C$0.9894 to the U.S. dollar, or $1.0107.
The currency's CAD=D4 gains were kept in check by a narrow range between C$0.9865 to C$0.9910.
"The Canadian dollar is moving higher along with about half the majors against the U.S. dollar today, and nothing too shocking of course as the United States is out for the holiday, but it's been a fairly restrained range," said Sacha Tihayni, currency strategist at Scotia Capital.
U.S. markets were shut for the Martin Luther King holiday.
"It's interesting because the commodity complex is somewhat weaker ... very light supply/demand flows in the market and just underpinned by perhaps by the reason that you can't really find a good reason to sell the Canadian dollar today just because of the short-term fundamental story," Tihanyi added.
He noted that the Bank of Canada interest rate announcement on Tuesday will provide further direction.
"There is a lot of risk in the market, just on what kind of comments they could make regarding where the currency is trading vis-a-vis the assumptions that they place in their forecast."
The central bank is unanimously expected to keep interest rates steady at 1 percent, but primary dealers and global forecasters are pulling forward targets for the next rate hike. [ID:nN1340408]
Besides the bank's rate announcement, further direction is expected to be driven by the Bank of Canada's Monetary Policy Report on Wednesday.
Canadian government bond prices were little changed. The two-year bond CA2YT=RR added 2 Canadian cents to yield 1.781 percent, while the 10-year bond CA10YT=RR gained 4 Canadian cents to yield 3.266 percent. (Editing by Jeffrey Hodgson)