The U.S. dollar edged up to fresh one-month highs against its Canadian counterpart on Wednesday, as expectations for a near-term U.S. rate hike continued to lend broad support to the greenback.
USD/CAD hit 1.2710 during early U.S. trade, the pair’s highest since February 2; the pair subsequently consolidated at 1.2704, adding 0.16%.
The pair was likely to find support at 1.2570, the low of March 9 and resistance at 1.2771, the high of February 2.
The greenback remained broadly supported after the latest U.S. jobs report heigthened expectations for higher interest rates.
The Federal Reserve is expected to begin raising interest rates around the middle of this year and investors were looking ahead to next week’s policy statement to see if it would drop its reference to being patient before raising rates.
The loonie was sharply higher against the euro, with EUR/CAD tumbling 0.92% to 1.3443.
The euro remained under broad selling pressure after the European Central Bank began purchasing securities on Monday as part of an asset-buying program amounting to €60 billion a month.
Concerns over the situation in Greece also weighed, as the eurogroup of finance ministers continued talks in Brussels to discuss a reform package put forward by Greece as part of its bailout review.
Germany’s finance minister Wolfgang Schaeuble warned Tuesday that Greece must stop wasting time and start developing its reform package.