CAD Strengths Amid Crude Oil Decline Ahead of Fed Rate Decision

The Canadian dollar has strengthened against its US counterpart despite losses in crude oil prices. On Tuesday, the Canadian dollar settled at US$0.7091 or US$1=C$1.4102, a slight increase from Monday's close of US$0.7085 or US$1=C$1.4114.

The upcoming interest rate announcement by the U.S. Federal Reserve on Wednesday is expected to have little impact, with analysts predicting that rates will remain unchanged. However, accompanying statements are likely to be closely watched for signs of future moves, including a potential rate hike as early as September.

Meanwhile, Canadian inflation data for May is set to be released on Friday, which could influence market sentiment. The conflict in the Middle East continues to weigh on crude oil prices, with West Texas Intermediate down 4.2 per cent at US$79.18 per barrel.