Canadian Dollar Weakens Amid Falling Oil Prices

The Canadian dollar dropped against its major rivals in the Asian session on Wednesday, after an industry data showed that U.S. crude inventories rose more than forecast last week.

The American Petroleum Institute reported late Tuesday that U.S. crude stocks rose by 3.6 million barrels for the week ended October 29, up from expectations of 1.6 million-barrel increase. This is up from a surge of 2.3 million barrels in the previous week.

The API data also showed gasoline stockpiles declined by 552,000 barrels last week, while distillate inventories gained by 573,000 barrels.

The Energy Information Administration will release its official inventory data later today.

The Fed is expected to announce the start of tapering bond purchases when it concludes monetary policy meeting later in the day.

Investors await more hints about the possibility of interest rate hikes next year in the wake of the recent spike in inflation.

The loonie edged down to 1.4390 against the euro and 0.9244 against the aussie, off its early highs of 1.4353 and 0.9208, respectively. The loonie is poised to challenge support around 1.46 against the euro and 0.94 against the aussie.

Reversing from its previous highs of 1.2398 against the greenback and 91.86 against the yen, the loonie weakened to 1.2422 and 91.59, respectively. The loonie is seen finding support around 1.26 against the greenback and 0.90 against the yen.

Looking ahead, U.K. services PMI for October and Eurozone jobless rate for September are due in the European session.

U.S. ADP private payrolls data for October is scheduled for release at 8:15 am ET.

U.S. ISM services PMI for October and factory orders for September will be out in the New York session.

At 2:00 pm ET, the Fed announces its decision on interest rate. Economists widely expect the federal funds rate to be kept at 0-0.25 percent.