* Canadian dollar rises 0.3 percent against the greenback
* Price of U.S. oil rises nearly 2 percent
* Canada's industry capacity use fell to 82.6 percent in Q3
* Canadian bond prices trade lower across the yield curve
TORONTO, Dec 12 (Reuters) - The Canadian dollar strengthened against its U.S. counterpart on Wednesday, boosted by higher oil prices and investor optimism over trade negotiations between the United States and China.
U.S. President Donald Trump, in an interview with Reuters, said that trade talks with Beijing were underway by telephone, with more meetings likely between U.S. and Chinese officials. also said he would intervene in the Justice Department's case against a top executive at China's Huawei Technologies HWT.UL if it would serve national security interests or help close a trade deal with China. executive was granted bail by a Canadian court on Tuesday, 10 days after her arrest in Vancouver at the request of U.S. authorities sparked a diplomatic dispute. exports many commodities, including oil, and runs a current account deficit, so its economy stands to benefit if the outlook improves for the global flow of trade and capital.
Stocks rose as Trump's comments fueled optimism over trade negotiations between the United States and China, while the price of oil was supported by an industry report that showed a drop in U.S. crude inventories, a cut in Libyan exports and an OPEC-led deal to trim output. crude oil futures CLc1 were up nearly 2 percent at $52.67 a barrel.
At 9:06 a.m. (1406 GMT), the Canadian dollar CAD=D4 was trading 0.3 percent higher at 1.3346 to the greenback, or 74.93 U.S. cents. The currency traded in a range of 1.3340 to 1.3398.
Last Thursday, the loonie touched its weakest level in nearly 18 months at 1.3445 to the U.S. dollar after Bank of Canada Governor Stephen Poloz said the economy was less strong than forecast. industry ran at 82.6 percent of capacity in the third quarter, below a downwardly revised 84.1 percent in the second quarter, Statistics Canada said on Wednesday. the Teranet-National Bank Composite House Price Index showed that Canadian home prices fell 0.3 percent in November from October, the second straight month of decline. government bond prices were lower across the yield curve in sympathy with U.S. Treasuries. The two-year CA2YT=RR fell 4 Canadian cents to yield 2.059 percent and the 10-year CA10YT=RR declined 21 Canadian cents to yield 2.105 percent.