Canadian Dollar Advances On Higher Oil Prices

The Canadian dollar advanced against its major counterparts in early European deals on Monday, as oil prices rose after Saudi Arabia's energy minister Khalid Al Falih urged co-operation between OPEC and non-OPEC producers to extend oil output cuts beyond 2018.

Crude for March delivery rose $0.27 to $63.58 per barrel.

"We shouldn't limit our efforts to 2018 - we need to be talking about a longer framework of cooperation. I am talking about extending the framework that we started, which is the declaration of cooperation, beyond 2018," Falih said in Oman.

Falling drilling activity in the U.S. further supported crude prices.

Data from energy services firm Baker Hughes showed that U.S. rig count fell by five to 747 in the week to January 19.

Investors also kept an eye on political developments in Europe after Germany's Social Democrats voted to enter coalition talks with Chancellor Angela Merkel's government and French President Emmanuel Macron said it would be possible for Britain to secure a bespoke trade deal if the U.K. accepts certain "preconditions".

The loonie rose against its major rivals in the Asian session, with the exception of the greenback.

The loonie reversed from an early low of 0.9992 against the aussie, rising to 0.9965. The next possible resistance for the loonie is seen around the 0.97 area.

The loonie edged up to 88.90 versus yen and 1.5248 against the euro, off its early 5-day lows of 88.55 and 1.5307, respectively. If the loonie rises further, it may find resistance around 92.0 against the yen and 1.50 against the euro.

The loonie rose to 1.2464 against the greenback, after having fallen to 1.2496 at 6:15 pm ET. Continuation of the loonie's uptrend may see it challenging resistance around the 1.24 region.

Looking ahead, Canada wholesale sales for November are set for release.