USD/CAD Bearish levels on chart

The Canadian dollar strengthened to its highest level in nearly two weeks against its U.S. counterpart on Monday as oil prices climbed and investors awaited CPI data this week.

The price of oil, one of Canada's major exports, rose as Iranian nuclear talks appeared to hit obstacles and an embargo on Russian oil shipments loomed.

U.S. crude
CL1!
prices were up 1.9% at $88.42 a barrel, while the U.S. dollar
DXY
extended its recent pullback against a basket of major currencies as the prospect of further aggressive monetary tightening by the European Central Bank bolstered the euro.

Wall Street's main indexes opened higher as investors positioned themselves for a U.S. consumer price reading on Tuesday that could determine the pace of interest rate hikes by the Federal Reserve.

The Canadian dollar

USDCAD
was trading 0.3% higher at 1.2985 to the greenback, or 77.01 U.S. cents, after touching its strongest since Aug. 30 at 1.2975.

Still, speculators have cut their bullish bets on the Canadian dollar to the lowest in six weeks, data from the U.S. Commodity Futures Trading Commission showed on Friday. As of Sept. 6, net long positions had decreased to 17,910 contracts from 24,179 in the prior week.

Separate data on Friday showed that Canada shed jobs for a third straight month in August, though economists said it was unlikely to force the Bank of Canada to pause interest rate hikes.

The ratio of Canadian household debt-to-income widened to a record 181.7% in the second quarter from an downwardly revised 179.3% in the first quarter, Statistics Canada said on Monday.

Canadian government bond yields were lower across the curve, tracking the move in U.S. Treasuries. The 10-year (CA10YT=RR) eased 3 basis points to 3.102%.