* Canadian dollar at C$1.3013, or 76.85 U.S. cents
* Bond prices higher across the yield curve
* Canada-U.S. 2-year spread hits widest in more than one year
TORONTO, June 11 (Reuters) - The Canadian dollar weakened against its U.S. counterpart on Monday after U.S. President Donald Trump, who has threatened to scrap the NAFTA trade pact, attacked Canadian Prime Minister Justin Trudeau in their feud over trade, and as oil prices fell.
Trump fired off a volley of tweets on Monday venting anger on NATO allies, the European Union and Trudeau in the wake of a divisive G7 meeting in Quebec over the weekend. tweeted on Saturday that Trudeau's remarks at a news conference, where he said Canada would not be pushed around, “were very dishonest and weak.”
The loonie has been pressured recently by new U.S. tariffs on steel and aluminum imports and slow-moving talks to modernize the North American Free Trade Agreement.
Canada sends about 75 percent of its exports to the United States and so its economy would be badly hit if NAFTA were scrapped.
The price of oil, one of Canada's major exports, was pulled down by rising Russian production and the highest U.S. drilling activity in more than three years. U.S. crude CLc1 prices were down 1.1 percent at $65.05 a barrel. 9:16 a.m. EDT (1316 GMT), the Canadian dollar CAD=D4 was trading 0.7 percent lower at C$1.3013 to the greenback, or 76.85 U.S. cents. The currency traded in a range of C$1.2957 to C$1.3027.
Losses for the loonie came after data on Friday showed the Canadian economy unexpectedly shed jobs in May. Still, wages rose at their strongest annual pace in nearly six years, which could give the central bank room to raise interest rates as soon as July. have added to bearish bets on the Canadian dollar, data from the U.S. Commodity Futures Trading Commission and Reuters calculations showed on Friday. As of June 5, net short positions rose to 16,039 contracts from 15,690 a week earlier.
Canadian government bond prices were higher across the yield curve, with the two-year CA2YT=RR up 3.5 Canadian cents to yield 1.907 percent and the 10-year CA10YT=RR rising 14 Canadian cents to yield 2.307 percent.
The gap between Canada's 2-year yield and its U.S. equivalent widened by 4.7 basis points to a spread of -61.7 basis points, its widest since May 2017.