Investing.com - The Canadian dollar pulled back from session lows against the U.S. dollar on Tuesday as oil prices turned higher following the release of upbeat U.S. housing data.
USD/CAD was last at 1.3086, off highs of 1.3127.
The Commerce Department reported that housing starts rose 0.2% to an annual pace of 1.21 million units, the highest level since October 2007.
It was the fourth straight month that housing starts remained above a one million-unit rate.
Building permits fell 16.3% in July, but that was after three consecutive months of strong gains.
The encouraging data came as investors were looking ahead to Wednesday’s minutes of the Federal Reserve’s July meeting, which it was hoped would provide more clarity on its plans to hike short-term interest rates for the first time since 2006.
The US dollar index, which tracks the greenback against a basket of six major rivals, rose to 97.02 from around 96.82 ahead of the data.
U.S. oil prices rose session highs following the release of the report, after falling to more than six-year lows earlier Tuesday following steep losses in Chinese stocks.
The steep drop fanned fears over the demand outlook in China, the world's second largest oil consumer after the U.S.
Falling oil prices have put pressure on the Canadian economy, which is struggling to shake off the recessionary effects of low oil prices.