Canadian Dollar Weakens On Falling Oil Prices

The Canadian dollar slipped against its major counterparts in early European deals on Tuesday amid falling oil prices, as Keystone pipeline resumed operation and investors awaited OPEC meeting in Vienna to discuss the extension of cartel's oil production cuts.

Crude for January delivery fell $0.51 to $57.60 per barrel.

Oil shipments through Keystone pipeline began today, after an outage for nearly two weeks. The pipeline will resume operations at a reduced pressure "to ensure a safe and gradual increase in the volume of crude oil moving through the system, the company said in a statement.

OPEC/non-OPEC members are scheduled to meet in Vienna on Thursday, at which they discuss whether to extend last year's landmark production deal beyond its expiry next March.

The American Petroleum Institute releases its crude inventory data later in the day, while the Energy Information Administration will publish its official data on Wednesday.

Investors also awaited developments on U.S. tax reform bills ahead of a crucial Senate vote and the confirmation hearing for incoming Federal Reserve Governor Jerome Powel.

The loonie held steady against its major rivals in the Asian session, with the exception of the yen.

The loonie retreated to a 3-month low of 86.91 versus the Japanese yen, from a high of 87.24 hit at 8:45 pm ET. The loonie is seen finding support around the 85.00 mark.

The loonie weakened to a 1-week low of 1.2794 against the greenback and a 5-1/2-month low of 1.5230 against the euro, off its early highs of 1.2754 and 1.5176, respectively. If the loonie falls further, it may target support around 1.29 against the greenback and 1.54 against the euro.

Reversing from an early high of 0.9700 against the aussie, the loonie dropped to a 2-week low of 0.9726. Continuation of the loonie's downtrend may see it challenging support around the 0.99 area.

Weekly survey compiled by the ANZ bank and Roy Morgan Research showed that Australia's consumer confidence eased during the weak ended November 28, after strengthening in the previous two weeks.

The consumer confidence index dropped to 115.0 from 116.4 in the preceding month.

Looking ahead, German GfK consumer sentiment for December is due shortly.

In the New York session, Canada industrial product and raw materials price indices for October, U.S. wholesale inventories for October, S&P Case/Shiller home price index and FHFA's house price index for September and consumer confidence index for November are set for release.