Investing.com - The U.S. dollar rose to the strongest level in six weeks against Canada’s dollar on Wednesday, as the Canadian dollar remained under pressure following dovish comments by Bank of Canada Governor Stephen Poloz.
USD/CAD hit 1.1195, the highest since January 31 and was last up 0.36% to 1.1176.
The pair was likely to find support at 1.1095 and resistance at 1.1223, the high of January 31 and a more than four-year high.
The loonie, as the Canadian dollar is also known, fell against the dollar on Tuesday after the Poloz said the bank could have to cut rates if inflation remains low. He also warned that economic growth in the first quarter could be “on the soft side”.
The comments came during a speech to the Halifax Chamber of Commerce.
Data released on Wednesday showed that Canadian wholesale sales rose 0.8% in January, undershooting forecasts for a 1% gain.
The greenback’s gains were held in check as investors remained cautious ahead of the Federal Reserve’s policy announcement later in the trading day.
The Fed was widely expected to announce a third reduction in the monthly pace of its bond purchases from $65 billion to $55 billion at the conclusion of its monthly meeting later Wednesday, the first with Janet Yellen at the helm.
The central bank was also expected to confirm that recent softness in U.S. economic reports was due to severe winter weather.
Elsewhere, the loonie was trading at more than four-year lows against the euro, with EUR/CAD rising 0.24% to 1.5552.