EUR/CAD edges higher on weaker CAD; remains below mid-1.6300s ahead of Canadian CPI

• EUR/CAD attracts some buyers as bearish Oil prices continue to undermine the Loonie.
• The France's credit rating downgrade weighs on the EUR and cap gains for spot prices.
• The divergent BoC-ECB expectations remain supportive ahead of the Canadian CPI data.

The EUR/CAD cross edges higher during the Asian session on Tuesday, though it lacks follow-through and remains confined in the previous day's broader trading range. Spot prices currently trade around the 1.6345-1.6350 region, nearly unchanged for the day, as traders await the latest Canadian consumer inflation figures for some meaningful impetus.

In the meantime, the Bank of Canada's (BoC) quarterly business and consumer surveys released on Monday reaffirmed market bets for another interest rate cut this month, which keeps the Canadian Dollar (CAD) depressed. Apart from this, bearish Crude Oil prices seem to undermine the commodity-linked Loonie and turn out to be another factor lending support to the EUR/CAD cross.

The shared currency, on the other hand, continues with its relative underperformance after S&P Global Rating's downgrade of France's credit rating to A+ from AA-, citing elevated budget uncertainty. Apart from this, a modest US Dollar (USD) uptick is seen exerting some pressure on the Euro (EUR), which, in turn, seems to act as a headwind for the EUR/CAD cross and capping gains.

Meanwhile, the European Central Bank (ECB) President Christine Lagarde will speak at the Norges Bank Climate Conference later today, though she is unlikely to comments on the monetary policy or influence the EUR. That said, diminishing odds for any further cut in borrowing costs by the ECB could offer some support to the EUR/CAD cross, warranting some caution for bearish traders.