TORONTO: The Canadian dollar was little changed against its broadly stronger US counterpart on Wednesday, holding on to this week's gains as oil prices rose and domestic data showed the value of building permits scaling a record high in January.

The loonie was trading nearly unchanged at 1.2629 to the greenback, or 79.18 US cents. Since the start of the week, it has advanced 0.9%.

Canada's "strong" GDP data and the rally in oil prices have helped underpin the Canadian dollar, said George Davis, chief technical strategist at RBC Capital Markets.

The price of oil, one of Canada's major exports, settled 2.6% higher at $61.28 a barrel, boosted by a huge drop in US fuel inventories and expectations that OPEC+ producers might decide against increasing output when they meet this week.

Canadian building permits rose 8.2% in January from December to C$9.9 billion, surpassing the previous record set in April 2019, Statistics Canada said.

On Tuesday, data showed that Canada's economy grew at an annualized rate of 9.6% in the fourth quarter and likely rose again in January, boosting speculation the Bank of Canada will reduce its bond purchases soon.

The central bank is due to make an interest rate decision next Wednesday.

A break of 1.2587 would add "to positive CAD momentum," while the currency could find buyers at 1.2655, Davis said.

The US dollar rose against a basket of major currencies as investors priced for strong US growth relative to other regions.

Canadian government bond yields were higher across a steeper curve in tandem with US Treasury yields.

The 10-year rose 7.6 basis points to 1.401% but was trading well below Friday's 13-month high at 1.501%.