Canadian dollar hits eight-week peak ahead of inflation data

The Canadian dollar rose to its highest level in eight weeks against the U.S. dollar on Tuesday, but its gains were limited as the dollar was supported by geopolitical concerns and investors awaiting the release of the country's key inflation report.

The Canadian dollar rose to 1.3268 per $1, its highest level since Sept. 20.

The released data showed that U.S. producers prices rose less than forecast in October, providing further evidence that inflation is beginning to subside.

Edward Moya, a senior market analyst at OANDA, said in a note that the general consensus is that a soft landing still seems possible.

On Wednesday, investors will await the release of Canadian inflation data for October to see if the Bank of Canada will raise interest rates by 25 or 50 basis points during its next meeting Dec. 7.

Canada's wholesale trade volume rose 0.1% in September compared to August, beating forecasts of a 0.2% decline. In addition, amid an expected 0.2% decline, separate data showed that manufacturing sales in September were unchanged from August.