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CANADA STOCKS-TSX futures subdued as investors eye BoC meeting

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Traders price in 25 bps hike by BoC on Wednesday

Dec 05 (Reuters) - Futures tracking Canada's main stock index were subdued on Monday after registering their second straight week of gains, with investors cautious ahead of Bank of Canada's (BoC) monetary policy meeting later in the week.

Futures on the S&P/TSX index were flat at 6:48 a.m. ET. The TSX gained 0.5% last week, with investors weighing stronger U.S. and Canadian jobs data that could help determine the pace of central bank interest rate hikes.

The BoC will decide on interest rates on Wednesday, with traders pricing in a 73.6% chance of a dialed-down 25-bps hike to 4%, after the central bank had surprised markets with a 50-bps increase last month.

The aggressive rise in borrowing costs had triggered concerns about an economic slowdown, with the commodity-heavy TSX index down 3.5% year-to-date and bond markets showing deep yield curve inversions - a harbinger for recession.

The BoC has forecast that growth would stall from the fourth quarter of this year through the middle of 2023.

Domestic building permits data for October is due at 8:30 a.m. ET.

Meanwhile, prices of Canada's major export oil jumped nearly 2% on Monday after OPEC+ nations held their output targets steady ahead of a European Union ban and a G7 price cap which kicked in on Russian crude.

Focus will also be on U.S. ISM services sector data due at 10 a.m. ET for November to gauge the Federal Reserve's next move at its rate-setting meeting later this month. (Reporting by Shashwat Chauhan in Bengaluru; Editing by Eileen Soreng)