Investing.com - The U.S. dollar edged higher against its Canadian counterpart on Friday, as optimism over the strength of the U.S. economy and expectations for a near-term rate hike by the Federal Reserve lent support to the greenback.
USD/CAD hit 1.3098 during early U.S. trade, the pair’s highest since Wednesday; the pair subsequently consolidated at 1.3088, adding 0.13%.
The pair was likely to find support at 1.3007, Thursday’s low and resistance at 1.3121, Wednesday’s high.
The greenback remained supported after Fed Chair Janet Yellen told the U.S. Senate Banking Committee on Tuesday that the central bank will likely need to raise interest rates at one of its upcoming meetings.
Ms. Yellen said that waiting too long to raise interest rates would be "unwise," given the rise in inflation and economic growth.
The dollar was also underpinned by Thursday’s upbeat U.S. jobless claims and building permits data.
Meanwhile, demand for the commodity-related Canadian dollar was dampened by lower oil prices on Friday, as investors remained cautious following reports the Organization of the Petroleum Exporting Countries could prolong its output cut plan in order to counter the effects of rising U.S. production.
Also Friday, Statistics Canada reported that foreign securities purchases increased by C$10.23 billion in December after a rise of C$7.26 billion in November, whose figure was revised from a previously estimated C$7.24 gain.
The loonie was steady against the euro, with EUR/CAD at 1.3950.