Investing.com - The Canadian dollar was lower against its U.S. counterpart on Monday as the greenback recovered after data on Friday showing tepid U.S. wage growth dampened expectations for a faster rate of interest rate hikes this year.
USD/CAD hit highs of 1.3086 and was last at 1.3080, up 0.47% for the day.
The U.S. dollar index, which measures the greenback’s strength against a trade-weighted basket of six major currencies, rose 0.38% to 100.06.
The greenback ended lower for a fourth straight week on Friday after the latest U.S. employment report showed that while jobs growth beat expectations in January wage growth slowed.
The slowdown in wage growth looked likely prompt the Federal Reserve to adopt a more cautious approach on raising interest rates.
According to Investing.com's Fed Rate Monitor Tool less than 10% of traders expect the Fed to raise interest rates at its next meeting in March. The chance of a June increase is seen at just below 50%.
The Fed, which last hiked rates in December, has forecast three rate hikes this year.
Last week, the Fed stuck to its view that the economy is strengthening, but gave no clear signal on the timing of its next rate hike as officials wait to assess the possible economic impact of the Trump administration’s protectionist policies and recent remarks about currencies.
The greenback has been hard hit by concerns that a preference for a weak dollar could have a prominent role to play in Trump's 'America First' agenda.
Lower prices for oil, a major Canadian export, also weighed on the Canadian dollar.
Oil prices remained under pressure amid concerns that increasing U.S. production could derail efforts by other major producers to reduce a global supply glut.