Investing.com - The U.S. dollar rose against its Canadian counterpart on Tuesday, as general optimism over the outlook for the U.S. economy boosted demand for to the greenback, although higher oil prices still lent support to the Canadian currency.
USD/CAD hit 1.3175 during early U.S. trade, the pair’s highest since September 30; the pair subsequently consolidated at 1.3159, gaining 0.30%.
The pair was likely to find support at 1.3064, Monday’s low and resistance at 1.3195, the high of September 30.
The U.S. dollar strengthened broadly as upbeat manufacturing activity and consumer sentiment data boosted optimism over the strength of the economy and supported the case for a rate hike by the Federal Reserve before the year end.
Market participants were focusing on Friday’s U.S. nonfarm payrolls report for further indications on the strength of the job market, as the Federal Reserve has indicated that future interest rate decisions will be data-dependent.
Meanwhile, the commodity-related Canadian dollar remained supported by higher oil prices on Tuesday, as the production freeze deal announced last week continued to support.
The loonie was higher against the euro, with EUR/CAD edging down 0.13% to 1.4687.