A Canadian dollar coin, commonly known as the "Loonie", is pictured in this illustration picture taken in Toronto in this January 23, 2015, file photo. The Canadian dollar pared earlier session losses against its U.S. counterpart on Tuesday, strengthening after data showed January growth was better than feared. REUTERS/Mark Blinch/FilesMARK BLINCH/Reuters
The Canadian dollar closed the day at 76.59 cents (U.S.), up 0.17 cents (U.S) from Monday's close of 76.42 cents (U.S.)
The Canadian dollar was volatile on Tuesday after the price of oil fell close to its six-year low in early trading, but recovered by the end of the day. The September contract for WTI crude traded as low as $41.88 (U.S.) on Tuesday, settling the day at $42.62 (U.S), up 75 cents (U.S.) from Monday's close.
The volatility in oil prices was in reaction to stock markets tumbling nearly six percent in China on Tuesday and the yuan weakening again against the U.S. dollar. China is the world's largest energy consumer and a slowdown in that country would put more downward pressure on the price of oil, which could impact the Canadian dollar.
South of the border, upbeat economic news helped support oil's rebound after the the U.S. Commerce Department reported housing starts surged to an almost eight-year high in July 2015. This is mostly due to an increase in construction of single-family homes.
The focus on Wednesday will be on the U.S. Federal Reserve. It will release the minutes from its July meeting at 2 p.m. (ET). This could provide further insight into whether the U.S. Fed will be raising rates in September. Also in the U.S., inflation and core CPI data will be released at 8:30 am.
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