Canadian dollar hits 6-day low as investors await Fed minutes

TORONTO (Reuters) – The Canadian dollar weakened to its lowest level in nearly one week against its U.S. counterpart on Wednesday as broader gains for the greenback, ahead of minutes from the Federal Reserve’s latest policy decision, offset higher oil prices.

The U.S. dollar snapped a two-day losing streak against a basket of major currencies. The Fed minutes, due at 2 p.m. ET (1800 GMT), could offer clues on just how aggressively the U.S. central bank might jack up interest rates in the coming months.

The Bank of Canada is due to make a policy decision next week. Money markets expect Canada’s central bank to hike by half a percentage point for the second straight meeting.

The price of oil, one of Canada’s major exports, was buoyed by tight supplies and the prospect of rising demand from the summer driving season in the United States. U.S. crude prices were up 0.6% at $110.38 a barrel.

The Canadian dollar was trading 0.1% lower at 1.2833 to the greenback, or 77.92 U.S. cents, after touching its weakest since May 19 at 1.2884.

Canadian government bond yields were lower across the curve. The 10-year touched its lowest since April 27 at 2.743% before recovering to 2.784%, down 2.6 basis points on the day.

(Reporting by Fergal Smith; editing by Jonathan Oatis)