* Canadian dollar at C$1.2852, or 77.81 U.S cents
* Oil prices rise 0.6 percent
* Bond prices lower across the yield curve
TORONTO, Dec 12 (Reuters) - The Canadian dollar was little
changed against its U.S. counterpart on Tuesday as higher oil
prices offset an acceleration in U.S. producer price inflation,
while investors awaited a Federal Reserve interest rate decision
on Wednesday.
The price of oil, one of Canada's major exports, rose
following a shutdown of the UK's biggest North Sea oil pipeline.
U.S. crude prices were up 0.6 percent at $58.34 a
barrel.
The U.S. dollar advanced against a basket of major
currencies after data showed that U.S. producer prices rose in
November at the fastest annual pace in nearly six years.
The Fed is widely expected to raise interest rates for the
fifth time since late 2015.
At 9:18 a.m. ET (1418 GMT), the Canadian dollar was
little changed at C$1.2852 to the greenback, or 77.81 U.S.
The currency traded in a narrow range of C$1.2815 to
C$1.2861. On Friday, it touched its weakest level in a week, at
C$1.2880.
The loonie had been pressured last week after the Bank of
Canada struck a more dovish tone than investors had expected as
it left its benchmark interest rate steady at 1 percent.
Bank of Canada Governor Stephen Poloz is due to discuss the
issues that keep him awake at night in a speech on Thursday.
Canadian government bond prices were lower across the yield
curve in sympathy with U.S. Treasuries. The two-year
dipped 2.5 Canadian cents to yield 1.526 percent and the
benchmark 10-year declined 21 Canadian cents to
yield 1.888 percent.
(Reporting by Fergal Smith)
