The Canadian dollar has reasons to rise: the economy grew by 0.3% in December 2016, bang on expectations, but this came on top of an upwards revision for November. All in all, the Canadian economy enjoyed stronger-than-expected growth at 2% instead of 1.7% expected. On an annualized basis, the growth rate was 2.6%, beating predictions of 2%.

However, oil prices took a tumble. After failing to extend the gains to a new cycle high above $55.20, WTI crude oil turned south and is trading at the $52 handle.

A third factor is the strength of the US dollar. The greenback continues enjoying the Dudley effect, that was accompanied by Williams and extended by Brainard. The three Fed officials hinted about a rate hike in March. We will hear from Fed Chair Janet Yellen tomorrow at 18:00 GMT.

Dollar/CAD trades around 1.34, above resistance at 1.3380 and under 1.3460. Here is how it looks on the chart: