CANADA FX DEBT-Loonie firms as Canada gets metals tariffs exemption

* Canadian dollar at C$1.2898, or 77.53 U.S. cents

* Bond prices mixed across the yield curve

* 10-year yield touched highest intraday since Feb. 28

TORONTO, March 8 (Reuters) - The Canadian dollar edged higher against the greenback on Thursday as Canada was exempted from U.S. metals tariffs and investors looked ahead to domestic jobs data due on Friday. U.S. President Donald Trump pressed ahead with the imposition of 25 percent tariffs on steel imports and 10 percent on aluminum but exempted Canada and Mexico, backtracking from earlier pledges of tariffs on all countries. Canada is the largest supplier of both metals to the United States. The gesture to Canada and Mexico was aimed at putting pressure on those countries to give ground in separate talks on the North American Free Trade Agreement, which appear to be stalled. "What they (the Trump administration) want and what Canada can readily give, there may still be some light between those two points," said Shaun Osborne, chief currency strategist at Scotiabank. "So I wouldn't say the risk has been lifted entirely, but it's much better than it looked for Canada, certainly late last week." U.S. plans for steel and aluminum tariffs and rising protectionist rhetoric "carry potentially serious consequences" and will dampen business investment, but it is too early to know how monetary policy should react, Bank of Canada Deputy Governor Tim Lane said. On Wednesday, the Bank of Canada left its benchmark interest rate unchanged at 1.25 percent. The central bank has raised interest rates three times since July and Canada's employment report for February can help guide expectations for further hikes. Economists in a Reuters poll expect jobs to rebound by 20,000 after slumping 88,000 in January. Data from Statistics Canada on Thursday showed that the value of Canadian building permits jumped 5.6 percent in January from December, while new home prices were flat for a second month in a row.

At 4 p.m. (2100 GMT), the Canadian dollar was

trading 0.1 percent higher at C$1.2898 to the greenback, or 77.53 U.S. cents. The currency traded in a range of C$1.2868 to C$1.2961. On Wednesday, the loonie matched Monday's low at C$1.3002, its weakest since July 5. The price of oil, one of Canada's major exports, headed for a second straight weekly drop. U.S. crude oil futures settled 1.7 percent lower at $60.12 a barrel. Canadian government bond prices were mixed across the yield

curve, with the 10-year rising 8 Canadian cents to

yield 2.227 percent. The yield touched its highest intraday since Feb. 28 at 2.246 percent.

(Reporting by Fergal Smith; Editing by David Gregorio and Peter Cooney)