Investing.com - The U.S. dollar dropped to two-month lows against its Canadian counterpart on Wednesday, despite weak Canadian data as demand for the greenback remained under pressure after investors pushed back expectations for a U.S. rate hike until 2016.
USD/CAD hit 1.2987 during early U.S. trade, the pair's lowest since August 13; the pair subsequently consolidated at 1.3002, sliding 0.24%.
The pair was likely to find support at 1.2858, the low of July 29 and resistance at 1.3136, Tuesday's high.
Statistics Canada reported on Wednesday that building permits dropped 3.7% in August, confounding expectations for a 0.8% rise. Building permits gained 0.7% in July, whose figure was revised from a previously estimated 0.6% decline.
The Canadian dollar was also boosted by rising oil prices. Crude oil futures for November delivery were up 1.59% at $49.29 at the open of U.S. trading.
Meanwhile, the dollar remained under pressure by diminished expectations for a rate hike by the Federal Reserve this year in the wake of last Fridays unexpectedly weak U.S. jobs report for September.
The loonie was also higher against the euro, with EUR/CAD dropping 0.48% to 1.4625.
The euro weakened after data showing that German industrial production fell at the fastest rate in a year in August, adding to concerns that a slowdown in global growth is spreading to the euro area’s largest economy.
German industrial output fell 1.2% from a month earlier, missing forecasts for a 0.2% increase.
The report came a day after data showing that German factory orders unexpectedly fell 1.8% in August.