* Canadian dollar at C$1.3287, or 75.26 U.S. cents
* Loonie touches its strongest since Dec. 14 at C$1.3255.
* Bond prices higher across the yield curve
TORONTO, Jan 5 (Reuters) - The Canadian dollar strengthened to a three-week high against its U.S. counterpart on Thursday as oil prices rose and the greenback lost ground against a basket of major currencies.
Some of the biggest gains on record for China's yuan sent currency markets spinning, driving the U.S. dollar broadly lower and threatening to quash one of the central bets of global investors for 2017. of oil, one of Canada's major exports, rose after Saudi Arabia started talks with customers about a reduction in crude sales to support a plan by OPEC to reduce global supply. O/R
U.S. crude CLc1 prices were up 0.71 percent at $53.64 a barrel.
At 9:15 a.m. ET (1415 GMT), the Canadian dollar CAD=D4 was trading at C$1.3287 to the greenback, or 75.26 U.S. cents, stronger than Wednesday's close of C$1.3308, or 75.14 U.S. cents.
The currency's weakest level of the session was C$1.3312, while it touched its strongest since Dec. 14 at C$1.3255.
The move follows a 3 percent gain for the currency in 2016, its first annual advance since 2012, as oil rebounded from its February trough.
Canadian producer prices rose 0.3 percent in November from October on higher prices for motorized and recreational vehicles and primary non-ferrous metal products, Statistics Canada said. government bond prices were higher across the yield curve, with the two-year CA2YT=RR price up 1.5 Canadian cents to yield 0.748 percent and the 10-year CA10YT=RR rising 5 Canadian cents to yield 1.705 percent.
The gap between Canada's 5-year yield and its U.S. equivalent narrowed by 3.3 basis points to -79.6 basis points, as U.S. Treasuries outperformed after data showed the U.S. economy created fewer private-sector jobs in December than market expectations.
Canada's trade report for November and employment report for December are due on Friday. ECONCA