* Canadian dollar rises 0.3% against the greenback
* Loonie trades in a range of 1.2590 to 1.2685
* Price of U.S. oil dips 0.1%
* Canadian bond yields ease across a flatter curve
TORONTO, March 9 (Reuters) - The Canadian dollar strengthened against its U.S. counterpart on Tuesday as a decline in bond yields bolstered risk appetite, while investors awaited an interest rate decision by the Bank of Canada on Wednesday.
The safe-haven U.S. dollar .DXY fell back from 3-1/2-month highs and U.S. stock index futures climbed, with investors scooping up beaten-down technology stocks. runs a current account deficit and is a major exporter of commodities, including oil, so the loonie tends to be sensitive to risk appetite.
U.S. crude oil futures CLc1 consolidated recent gains, dipping 0.1% to $64.98 a barrel. On Monday, oil touched its highest since October 2018, bolstered by tighter supply due to extended OPEC+ output curbs and growing hopes of a recovery in demand. Canadian dollar CAD= was trading 0.3% higher at 1.2621 to the greenback, or 79.23 U.S. cents, having traded in a range of 1.2590 to 1.2685.
Since the start of the year, the loonie has gained 0.9%, trailing just sterling GBP= and the Norwegian crown NOK= among G10 currencies.
Investors see rising chances that the Bank of Canada would hike interest rates next year as the economic outlook improves, but the central bank is likely to push back against those bets for now, pointing to still high unemployment, analysts say. government bond yields fell across a flatter curve in sympathy with U.S. Treasuries, with the 10-year CA10YT=RR down 6.2 basis points at 1.462%. On Monday, it touched its highest since January 2020 at 1.545%.