USDCAD0209020The USD/CAD pair extended its sideways consolidative price action through the European session and remained confined in a range, just above mid-1.3000s. A combination of diverging forces failed to assist the pair to capitalize on the previous day's goodish bounce of around 90 pips from sub-1.3000 levels or the lowest level since January. The prevalent bullish tone surrounding crude oil prices undermined the commodity-linked currency – the loonie – and capped the USD/CAD pair below the 1.3100 mark.

Meanwhile, the downside remained cushioned amid a modest pickup in the US dollar demand. Tuesday's better-than-expected US ISM Manufacturing PMI revived hopes of economic recovery and stemmed the recent USD bearish momentum. However, expectations that the Fed will keep rates lower for longer might kept a lid on any strong gains for the greenback.