* Canadian dollar rises 0.1% against the greenback
* Loonie touches its strongest since July 22 at 1.3050
* Price of U.S. oil increases 0.3%
* Canadian bond prices fall across a steeper yield curve
TORONTO, Oct 28 (Reuters) - The Canadian dollar strengthened to its highest in more than three months against the greenback on Monday after investors boosted bullish bets on the currency and ahead of an interest rate decision this week from the Bank of Canada. Net long positions in the loonie climbed to 33,393 contracts as of Oct. 22 from 12,961 in the prior week, data from the U.S. Commodity Futures Trading Commission and Reuters calculations showed on Friday. That was the highest level of bullish bets since February 2018. Canada's economy has added jobs at a robust pace in recent months and inflation has stayed close to the Bank of Canada's 2% target. The central bank is expected to leave its benchmark interest rate unchanged at 1.75% on Wednesday and through the rest of the year, a Reuters poll showed. The Bank of Canada has been on hold this year even as major central banks such as the U.S. Federal Reserve and the European Central Bank have eased. The Fed is expected to cut rates on Wednesday for the third time since July. That could lower the range for the Fed's benchmark rate below the Bank of Canada's equivalent rate for the first time since December 2016.
At 9:44 a.m. (1344 GMT), the Canadian dollar was
trading 0.1% higher at 1.3051 to the greenback, or 76.62 U.S. cents. The currency, which rose 0.5% last week, touched its strongest intraday level since July 22 at 1.3050. The price of oil, one of Canada's major exports, was supported by progress in China-U.S. trade talks. U.S. crude oil futures were up 0.3% at $56.84 a barrel. The gain for the loonie came as U.S. and Chinese officials said they were "close to finalizing" some parts of a trade agreement. Canada is a major exporter of commodities so its economy could benefit from an improved outlook for global trade.
Canadian government bond prices were lower across a steeper yield curve in sympathy with U.S. Treasuries. The two-year fell 6 Canadian cents to yield 1.692% and the 10-year was down 52 Canadian cents to yield 1.595%.
(Reporting by Fergal Smith; Editing by Steve Orlofsky)