* C$ rises to 98.62 U.S. cents
* Bond prices lower across curve
* Oil hits 2-year high, stocks positive
* US Q3 GDP revised up, previously owned home sales rise
(Updates to afternoon, adds U.S. data, quotes)
TORONTO, Dec 22 (Reuters) - Canada's dollar rose against
the greenback on Wednesday, rebounding from a recent slide as
the price of oil hit a two-year high and stronger U.S. data
signaled the economy was ending the year on solid ground.
Oil, a key Canadian export, rose after news of a drop in
U.S. inventories and cold weather on both sides of the
Atlantic. [O/R]
Also benefiting Canada's risk-related currency, sales of
previously owned U.S. homes rose in November and third-quarter
gross domestic product was revised up, higher than expected.
[ID:nN22291718] The stronger U.S. data encouraged risk takers,
a trend that supported stock prices as well as the Canadian
dollar.
"If you look at the global macro environment, it's
generally better sentiment," said Sacha Tihyani, currency
strategist at Scotia Capital.
"It's a bit of a reversal of underperformance over the past
couple days, more support of equity prices, surer support of
oil, and the fact that the U.S. numbers didn't disappoint."
At 2:40 p.m. (1940 GMT), the Canadian currency CAD=D4 was
at C$1.0140 to the U.S. dollar, or 98.62 U.S. cents, up from
C$1.0175 to the U.S. dollar, or 98.28 U.S. cents, at Tuesday's
close.
The Canadian dollar was among the day's outperforming major
currencies, on track to end four straight sessions of losses
against the greenback.
Tihanyi said the near-term trading range should hold
between C$1.01 to C$1.0210.
"We had a couple days of weakness in the Canadian dollar,
and there is a threshold through which the market wasn't
willing to bring it past, and I think that was probably seen as
a good value level to buy Canadian dollars in the near term,"
he said.
However, the Canadian dollar's moves are still expected to
be restrained. "In the big scheme of things, the Canadian
dollar remains in a pretty good uptrend. Canada's going to
grind higher but there won't be enough gas to push through par
before year end," said Michael O'Neill, managing director at
Knightsbridge Foreign Exchange.
Scotia's Tihanyi said given the seasonal light volumes, the
currency's direction may be driven more by flows -- even
relatively small orders -- than anything else, and recent
year-end trends have favored the U.S. dollar over Canada's.
Traders will now turn their attention to Canada's gross
domestic product figures for October, due Thursday. It's the
last major piece of data before the Christmas and New Year
holidays. [ECONCA]
With risk-taking back on, Canadian bond prices fell,
tracking U.S. Treasuries after the Federal Reserve completed
its last purchases until next week, and ahead of new supply.
[US/]
The two-year bond CA2YT=RR was down 6 Canadian cents to
yield 1.662 percent, while the 10-year bond CA10YT=RR slid 33
Canadian cents to yield 3.182 percent.
(Reporting by Claire Sibonney; Editing by Frank McGurty)