* C$ rises to 98.33 U.S. cents
* Bonds fall across curve as risk appetite mounts (Updates to close, adds details, commentary)
By Claire Sibonney
TORONTO, Dec 1 (Reuters) - The Canadian dollar was firmer against its U.S. counterpart on Wednesday, supported by strong global economic data and new hope for debt-strapped euro zone countries.
The upbeat economic outlook saw riskier assets being bought across the board, pushing up equities and commodity prices.
U.S. crude oil futures jumped more than 3 percent to end at a two-week high as U.S. private sector hiring posted its biggest gain in three years, while China's manufacturing data showed signs of robust growth. [O/R]
The euro also rebounded to outperform all other G10 currencies after Washington showed readiness to back a bigger EU stability fund and investors bet the European Central Bank could step up its bond-buying program. [ID:nBRU011183] [ID:nLDE6B00QU]
"The euro is basically embarrassing us all," said David Watt, senior fixed income and currency strategist at RBC Capital Markets.
Apart from the euro, commodity currencies such as Canada's shone, driven largely by the rise in oil prices to above $86 a barrel.
The Canadian dollar CAD=D4 closed the North American session at C$1.0170 to the U.S. dollar, or 98.33 U.S. cents, up from Tuesday's close at C$1.0266 to the greenback, or 97.41 U.S. cents.
"We are getting a relatively sizable bounce. What's going on in equity markets, some of the easing of concerns about EU periphery issues, that's all playing out and we've got the data that came out of the U.S. today which was fairly solid," Watt said.
"Our major trading partner is maybe on the road to recovery once again and the cyclical backdrop might not be as fretful as it was a month and half to two months ago."
The currency's began the new trading month with a strong advance, after recording a 0.6 percent retreat in November, its first monthly drop in three months.
Watt said the 200-day moving average of C$1.0289, tested on Tuesday, still represented significant resistance for the U.S. dollar against Canada's.
Canadian government bonds tracked U.S. Treasuries lower as appetite for riskier assets such as stocks drew investors away from the relative safety of government debt.
The two-year government of Canada bond CA2YT=RR was off 10 Canadian cents to yield 1.668 percent, while the 10-year bond CA10YT=RR slipped 85 Canadian cents to yield 3.169 percent.
In new issues, Canada's auction of 30-year real return bonds met with weaker than usual demand, after investors pushed up prices heading into the sale, making the issue less attractive. [ID:nN01153360]
Canada's data calendar is bare until Friday when the November jobs report is published. It will be the last major piece of data to consider before the Bank of Canada's next interest rate decision on Dec. 7.
The market is already pricing near-certainty that the central bank will leave unchanged the target for the overnight interest rate at 1 percent. BOCWATCH (Reporting by Claire Sibonney; editing by Rob Wilson)