Investing.com - The U.S. dollar slid lower against its Canadian counterpart on Wednesday, after data showed that U.S. inflation ticked lower last month and as investors remained cautious ahead of the Federal Reserve's policy decision on Thursday.
USD/CAD hit 1.3204 during early U.S. trade, the pair's lowest since September 10; the pair subsequently consolidated at 1.3209, retreating 0.29%.
The pair was likely to find support at 1.3150, the low of September 9 and resistance at 1.3262, Monday's high.
The Commerce Department said consumer prices edged down by 0.1% last month, in line with forecasts following a 0.1% increase in July. Consumer prices inched up 0.2% on a year-over-year basis, in line with expectations.
Core consumer prices, which exclude volatile food and energy costs, increased by 0.1%, also in line with the consensus forecast and was 0.2% higher from the same month a year earlier.
Investors remained cautious amid uncertainty over whether the Fed would hike short term interest rates for the first time in almost a decade on Thursday.
An increase in interest rates would boost the greenback by making it more attractive to yield-seeking investors.
Fed Chair Janet Yellen has said that an interest rate increase is data dependent but has also indicated that she expects to begin raising rates before the end of the year.
In Canada, data earlier showed that manufacturing sales increased by 1.7% in July, beating expectations for a 1.0% rise. Manufacturing sales gained 1.5% in June, whose figure was revised from a previously estimated 1.2% rise.
The loonie was higher against the euro, with EUR/CAD declining 0.25% to 1.4894.