Investing.com - The Canadian dollar was lower against the greenback in early trade on Monday as investors turned their attention back to prospects for higher U.S. interest rates after euro zone leaders reached an agreement on a bailout for Greece.
USD/CAD was last up 0.77% to 1.2756, recovering from Friday’s lows of 1.2653.
The greenback was boosted as the threat of a Greek exit from the euro zone dissipated, removing a potential obstacle from Federal Reserve plans to tighten monetary policy.
Fed Chair Janet Yellen said last Friday that the central bank was on track to raise interest rates at some point this year.
Investors were looking ahead to her testimony on the semiannual monetary policy report later in the week for any further indications on the timing of an initial rate hike.
Euro zone leaders reached a unanimous agreement on a third bailout deal for Greece earlier Monday, following marathon, weekend-long talks.
The Greek parliament must now pass new legislation by Wednesday to raise sales taxes, cut pension payments and enforce automatic spending cuts if the next budget misses its targets before negotiations on a third bailout program can begin.
The Canadian dollar had strengthened against its U.S. counterpart on Friday following the release of a better-than-forecast domestic jobs report.
Statistics Canada reported that the economy shed 6,400 jobs in June, fewer than the 10,000 loss forecast by economists.
The report prompted investors to trim back expectations for a rate cut by the Bank of Canada at its upcoming monetary policy meeting on Wednesday.
Elsewhere, the loonie, as the Canadian dollar is also known, was modestly higher against the euro, with EUR/CAD slipping 0.16% to 1.4095.
The U.S. dollar index, which measures the greenback’s strength against a trade-weighted basket of six major currencies, rallied 0.83% to trade at 96.76.