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The Canadian dollar was little changed against its U.S. counterpart on Thursday, holding onto the previous day’s gains as higher oil prices offset caution on Wall Street.

The price of oil, one of Canada’s major exports, climbed after data showed inventory declines in the United States and as investors began to expect that the global oil market could have a deficit sooner than they had previously thought.

U.S. crude oil futures settled 2.8 per cent higher at $52.58 a barrel.

Last week, the Bank of Canada worried about the impact on the economy of a sharp fall in oil prices since October and production cuts in Canada’s energy sector, as it left interest rates on hold and suggested the pace of future hikes could be more gradual.

“You have got some modest recovery in oil prices which is helping to support the Canadian dollar but then at the same time it looks like still a somewhat cautious broader market mood, and that’s perhaps restraining the Canadian dollar,” said Eric Viloria, an FX strategist at Crédit Agricole CIB in New York.

U.S. stocks edged lower in volatile trading on Thursday, as a rally sparked by progress in U.S.-China trade talks faded.

In addition to being a major commodities exporter, Canada runs a current account deficit, so its economy could be hurt if the global flow of trade or capital slows.

At 3:18 p.m. (2018 GMT), the Canadian dollar was trading nearly unchanged at 1.3351 to the greenback, or 74.90 U.S. cents. The currency traded in a narrow range of 1.3338 to 1.3383.

On Wednesday, the Canadian dollar gained ground against a broadly weaker greenback. The U.S. dollar steadied on Thursday after the European Central Bank promised to maintain policy support for the euro zone due to risks from trade tensions, Brexit and budget woes in Italy and France.

In domestic data, new home prices were unchanged in October for the third month in a row, Statistics Canada said.

Canadian government bond prices were mixed across a steeper yield curve in sympathy with U.S. Treasuries. The 10-year

fell 10 Canadian cents to yield 2.146 per cent.

Last Thursday, the 10-year yield touched its lowest in nearly one year at 2.026 per cent.