Investing.com - The U.S. dollar trimmed gains against its Canadian counterpart on Tuesday, as oil prices bounced back, but the greenback still remained supported by ongoing expectations for a 2016 U.S. rate hike.
USD/CAD pulled away from 1.3239, the session high, to hit 1.3214 during early U.S. trade, still up 0.30%.
The pair was likely to find support at 1.3106, the low of October 4 and resistance at 1.3279, Monday’s high.
Demand for the U.S. dollar remained supported as Friday’s disappointing U.S. jobs data was not expected to prevent the Federal Reserve from raising interest rates later this year.
Meanwhile, the commodity-related Canadian dollar regained some ground as oil prices bounced back higher on Tuesday, amid growing hopes for an OPEC-led production cut.
U.S. crude prices rallied to four-month highs on Monday after Russian President Vladimir Putin said his country is prepared to join an oil-output deal which may include a production freeze or cut.
The loonie was higher against the euro, with EUR/CAD sliding 0.30% to 1.4629.
In the euro zone, the ZEW Centre for Economic Research said that its index of German economic sentiment rose to 6.2 this month from September’s reading of 0.5. Analysts had expected the index to increase to 4.3 in October.
The index of euro zone economic sentiment increased to 12.3 in October from 5.4 a month earlier. Consensus was looking for an increase to 6.3.