* Bernanke signals U.S. rates to remain low
* U.S. home sales drop to record low in January
* C$ up at 94.99 U.S. cents
* Bonds mixed across the curve (Recasts after Bernanke testimony, U.S. home sales data)
By Claire Sibonney
TORONTO, Feb 24 (Reuters) - The Canadian dollar perked up against its U.S. counterpart on Wednesday as investor appetite for riskier assets was whetted by remarks from U.S. Federal Reserve Chairman Ben Bernanke, who reaffirmed his vow to keep interest rates low.
Bernanke told Congress that a weak job market and low inflation would likely allow the U.S. central bank to keep interest rates at very low levels for "an extended period." [ID:nN23153536]
"There's nothing in the speech that would suggest he's itching to tighten policy," said Sal Guatieri, a senior economist at BMO Capital Markets.
The remarks offset dismal data that showed sales of newly built U.S. single-family homes hit their lowest level since records started in January 1963, hinting at possible troubles for the fragile U.S. housing market's recovery. [ID:nN24373288]
"The tone of Bernanke's commentary is on the dovish side but the new home sales numbers are a real shock, suggesting just how fragile the U.S. housing market is," said Guatieri,
He pointed out that the data was particularly gloomy given the extension of a popular tax credit for first-time home buyers, which was also expanded for repeat buyers.
At 11:00 a.m. (1600 GMT) the Canadian dollar was at C$1.0527 to the U.S. dollar, or 94.99 U.S. cents, up from Tuesday's close at C$1.0566 to the U.S. dollar, or 94.64 U.S. cents.
Canadian bond prices were mixed across the curve after Bernanke's testimony sent equity markets higher.
The two-year Canadian government bond CA2YT=RR was flat at C$100.335 to yield 1.331 percent, while the 10-year bond CA10YT=RR added 2 Canadian cents to C$102.520 to yield 3.430 percent. (Reporting by Claire Sibonney; editing by Rob Wilson)