Investing.com - The U.S. dollar edged up to a two-week high against its Canadian counterpart on Monday, as new hopes for an upcoming rate hike by the Federal Reserve supported demand for the greenback.
USD/CAD hit 1.3030 during early U.S. trade, the pair’s highest since August 11; the pair subsequently consolidated at 1.3031, adding 0.22%.
The pair was likely to find support at 1.2920, the low of August 12 and resistance at 1.3080, the high of August 11.
At the Jackson Hole symposium on Friday, Fed Chair Janet Yellen said the case for U.S. interest rate hikes has “strengthened” in recent months due to improvements in the labor market and to expectations for solid economic growth.
However, she did not indicate when the Fed would act, saying that higher interest rates will depend on incoming economic data.
Speaking shortly afterwards, Fed Vice Chair Stanley Fischer said Yellen’s speech was “consistent” with expectations for possibly two more rate hikes this year, opening the door to a September hike.
Earlier Monday, the U.S. Commerce Department said personal spending increased 0.3% last month, in line with expectations.
The core PCE price index was up 1.6% on a year-over-year basis, where it has held since March.
Meanwhile, declining oil prices weighed on demand for the commodity-related Canadian dollar as hopes of a production freeze began to fade.
The loonie was steady against the euro, with EUR/CAD at 1.4550.