* Loonie trades in a range of 1.3288 to 1.3398
* Canada's economy adds barely any jobs in December
* Wage growth accelerates
* Canada-U.S. 2-year spread narrows by 2.2 basis points
TORONTO, Jan 5 (Reuters) - The Canadian dollar was little changed against its U.S. counterpart on Friday in seesaw trading as investors largely stuck with bets for central bank rate cuts over the coming months as they assessed mixed U.S. and Canadian jobs data.
The loonie was trading nearly unchanged at 1.3345 to the greenback, or 74.93 U.S. cents.
It touched its weakest level since Dec. 19 at 1.3398 shortly after the data was released before rebounding to its strongest of the day at 1.3288, as the U.S. dollar gyrated against a basket of major currencies.
"If you dig deeper it's not such a crazy good (U.S. jobs)report as the initial headline suggests," said Erik Bregar, director, FX & precious metals risk management at Silver Gold Bull. "That's why I think the dollar bulls are backing off here. That's why I think CAD's bouncing."
U.S. employers hired more workers than expected in December but there were potential red flags in the employment report, including difficulties adjusting the data for seasonal fluctuations.
Canada's economy added a meager 100 jobs in December but permanent employees' wages increased at the fastest pace in three years.
Money markets continued to expect the Federal Reserve to begin cutting interest rates as soon as March while they are leaning toward April for the Bank of Canada's first ease.
The Canadian dollar is expected to trade at stronger levels than previously thought over the year if the Fed pivots to cutting rates before the BoC, a Reuters poll found.
Canadian bond yields edged higher across the curve. The 2-year was up 1.4 basis points as 4.064%, while the gap between it and the U.S. equivalent narrowed by 2.2 basis points to about 31 basis points in favor of the U.S. note. (Reporting by Fergal Smith; Editing by Aurora Ellis)
