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The Canadian dollar was higher against its major counterparts in the European session on Wednesday, as the nation’s consumer inflation accelerated on an annual basis in August at the fastest pace since March 2003.

Data from Statistics Canada showed that the consumer price index rose 4.1 percent on year in August, up from a 3.7 percent gain in July. Economists had expected a 3.9 percent increase.

The surge in prices was mainly due to an accumulation of recent price pressures and from lower price levels in 2020.

The CPI rose 0.4 percent on a seasonally adjusted monthly basis in August, following a rise of 0.6 percent in July.

Core inflation excluding food and energy increased 0.3 percent from July, when it gained 0.5 percent.

Oil prices rose after industry data showed a larger than expected drawdown in U.S. crude stocks.

The American Petroleum Institute reported late Tuesday that U.S. crude supplies fell by 5.4 million barrels last week, compared to forecasts of 3.5 million barrel drop.

The loonie edged up to 1.2634 against the greenback and 1.4931 against the euro, off its early 6-day lows of 1.2709 and 1.5014, respectively. The loonie is poised to target resistance around 1.25 against the greenback and 1.48 against the euro.

The loonie reversed from an early more than 3-week low of 85.96 against the yen, with the pair trading at 86.55. The loonie is seen finding resistance around the 88 region.

The loonie climbed to 0.9270 against the aussie for the first time since September 1. If the loonie continues its uptrend, 90 is possibly seen as its next resistance level.


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