(Adds strategist quotes and details throughout; updates prices)
    * Canadian dollar rises 0.2% against the greenback
    * Loonie trades in a range of 1.3168 to 1.3244
    * U.S. oil prices settle 0.8% lower
    * Canadian bond yields ease across a flatter curve

    By Fergal Smith
    TORONTO, Aug 20 (Reuters) - The Canadian dollar strengthened
against its U.S. counterpart on Thursday as investors stuck to a
view that the U.S. Federal Reserve would add further stimulus
and as Canada announced the extension of an emergency support
measure.            
    Markets were rattled on Wednesday by minutes from last
month's Federal Reserve policy meeting that were less dovish
than some investors expected. But the impact was short-lived,
with U.S. Treasury yields falling and a rebound in the U.S.
dollar losing momentum on Thursday.             
    "The U.S. dollar continues to suffer against everything
right now because there's this belief that the Fed is going to
do something else," said Erik Bregar, head of FX strategy at the
Exchange Bank of Canada. "Whenever we see U.S. dollar selling,
it tends to help the Canadian dollar."
    Canada is extending a COVID-19 income-support program by one
month to the end of September, and it will offer unemployment
benefits to some 400,000 people who would not normally qualify,
a senior official said.             
    A staggered reopening from lockdowns, supported by fiscal
stimulus, is likely paying off for Canada's economy, with
activity forecast to rebound in the current quarter twice as
fast as in the United States.             
    The Canadian dollar        was trading 0.3% higher at 1.3173
to the greenback, or 75.91 U.S. cents. The currency, which on
Wednesday touched its strongest intraday level in nearly seven
months at 1.3133, traded in a range of 1.3168 to 1.3244.
    The price of oil, one of Canada's major exports, fell after
Reuters reported OPEC+ needed to address daily oversupply of
more than 2 million barrels, and the number of U.S. unemployment
benefit claims rose unexpectedly. U.S. crude oil futures       
settled 0.8% lower at $42.58 a barrel.                     
    Canadian government bond yields were lower across a flatter
curve. The 10-year             was down 2.5 basis points at
0.557%.    

 (Reporting by Fergal Smith; Editing by Marguerita Choy)
  

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