TORONTO: The Canadian dollar edged lower against its US counterpart on Wednesday as oil prices fell and investors awaited an interest rate announcement by the Federal Reserve, with the currency hovering near a six-day low it hit the day before.

The loonie was trading 0.1% lower at 1.2418 to the greenback, or 80.53 US cents, after trading in a range of 1.2405 to 1.2423.

It was the only G10 currency to lose ground against the US dollar. On Tuesday, it touched its weakest intraday level since Oct. 27 at 1.2424.

"The CAD is a relative under-performer on the session so far, with hefty declines in crude oil," strategists at Scotiabank, including Shaun Osborne, said in a note.

The price of oil, one of Canada's major exports, fell as industry data pointed to a big build in crude oil and distillate stocks in the United States, the world's largest oil consumer, and as pressure mounted on OPEC to increase supply.

Canadian dollar steadies as speculators turn bullish on the currency

US crude prices were down 2.3% at $82.00 a barrel.

The Fed is expected to detail plans to end its pandemic-era bond purchases by mid-2022 as policymakers shift their focus towards what, if anything, to do about a surge in inflation that is lasting longer than anticipated.

The policy announcement is due at 2 p.m. ET.

The market is also awaiting the release on Friday of US and Canadian employment data.

Data on Wednesday showed that US private payrolls increased by 571,000 jobs last month, though worker shortages linger.

Canadian government bond yields were mixed across a flatter curve, tracking the move in US Treasuries.

The 2-year yield rose 1.6 basis points to 1.063%, while the 10-year was down half a basis point at 1.719%. On Monday, it touched its highest level since May 2019 at 1.766%.