Investing.com - The U.S. dollar edged higher against its Canadian counterpart on Wednesday, as speculation over a potential U.S. rate hike next month supported the greenback despite the release of mixed U.S. housing sector reports.
USD/CAD hit 1.3348 during early U.S. trade, the pair's highest since Monday; the pair subsequently consolidated at 1.3334, adding 0.10%.
The pair was likely to find support at 1.3221, the low of November 12 and resistance at 1.3432, the high of September 30.
The U.S. Commerce Department reported that housing starts dropped 11% to 1.060 million units last month from September’s total of 1.191 million units. Analysts had expected a decline of 3.9% to 1.160 million.
Meanwhile, the number of U.S. building permits issued rose 4.1% to 1.150 million units from September’s total of 1.105 million, broadly in line with market expectations.
Demand for the dollar continued to be underpinned by expectations that the Fed will hike rates before the years end.
Investors were looking ahead to the minutes of the Fed’s October meeting, due out later in the day, for further indications on the prospects for a December rate hike.
The loonie was lower against the euro, with EUR/CAD gaining 0.30% to 1.4220.
The euro's gains were held in check as the European Central Bank is expected to expand its quantitative easing program and possibly cut rates further into negative territory at its December meeting.
The single currency also remained under pressure amid concerns that the terrorist attacks in Paris could undermine the already fragile economic recovery in the region.