Investing.com - The U.S. dollar fell to session lows against the Canadian dollar on Wednesday after data showed that Canadian retail sales rose at a faster than expected rate in May.
USD/CAD touched session lows of 1.0711, before pulling back to trade at 1.0726.
The pair was likely to find support at 1.0690 and resistance at 1.0775.
Statistics Canada reported that retail sales rose 0.7% in May, ahead of forecasts for a 0.6% gain, while the previous month’s number was revised up to 1.3%.
Core retail sales, which strip out automobile sales, rose 0.1% in May, falling short of expectations for a 0.3% increase and slowing from an upwardly revised 0.8% in April.
The Canadian’s dollar’s gains were held in check as demand for the greenback continued to be underpinned by expectations that U.S. interest rates may rise sooner than expected.
Data on Tuesday showing that U.S. inflation rose 0.3% in June, in line with forecasts, added to the view that the economy is improving.
Elsewhere, the loonie, as the Canadian dollar is also known, was at its 2014 highs against the broadly weaker euro, with EUR/CAD dipping 0.10% to 1.4443, the lowest since January 6.
Sentiment on the single currency was hit hard on Wednesday by concerns that a fresh round of sanctions against Russia would have a negative impact on the growth outlook for the euro area.
The euro has come under pressure since the European Central Bank cut rates to record lows on June 5, in a bid to stave off the threat of deflation and shore up the faltering recovery in the bloc.