USD/CAD trades in a rangebound manner on Wednesday in the Asian session.
Crude oil retreats from seven-year highs, but still, remains firm near 80.50.
Lower US Treasury yields undermine the demand for the US dollar.
The USD/CAD pair edges higher in the middle of the week. The pair has remained stuck in a narrow trade band of 1.2440 and 1.2500 for the past three-session. At the time of writing, USD/CAD is trading at 1.2470, up 0.04% for the day.
The US dollar retreats from the higher levels ahead of the US Core Inflation Index (CPI) readings. A day earlier, consensus forecasts pointed to a 5.3% in the CPI for September on yearly basis. The Federal Reserve will keep a close watch on inflation readings to go ahead with its tapering decision.
The Federal Reserve Bank of Richmond President Thomas Barkin commented pricing pressure is due to supply-chain bottlenecks that weigh on the greenback. In addition to that, Atlanta Fed President Raphael Bastic said the current inflation is not doing much to harm the economy to call Fed’s policy stance into question.
In the meantime, the US debt limit has passed in the House and will be presented to US President Joe Biden for signing.
The loonie manages to gain traction on robust WTI prices, a major Canadian export. As for now, traders are waiting for the US Core Inflation Index, and FOMC Minutes to take fresh trading impetus.