Canada's central bank is expected to hold its benchmark interest rate steady at 1.75pc on Wednesday and for the rest of this year, with calls for the next hike in early 2020, resting on a knife's edge, a Reuters poll showed.

"Any hiking bias will probably be removed completely from the statement," said Ranko Berich, head of market analysis at Monex Canada and Monex Europe. "The impetus for a rate hike has been removed by slowing economic data."

The Canadian economy has taken a hit from the province of Alberta's mandatory production cut of oil - its biggest export - a slowdown in the housing market and wilting business sentiment over worries surrounding the US-China trade war.

Canadian wholesale trade increased by 0.3 percent in February from January, Statistics Canada said on Tuesday. But trade was down 1.5pc after excluding the motor vehicle and motor vehicle parts and accessories subsector.

The US dollar rose against a basket of major currencies as traders favored the greenback ahead of the release on Friday of US gross domestic product data for the first three months of 2019.

At 3:23 p.m. (1923 GMT), the Canadian dollar

was trading 0.7% lower at 1.3436 to the greenback, or 74.43 US cents, its biggest decline in nearly seven weeks. The currency touched its weakest level since March 29 at 1.3443.

The decline for the loonie came despite a nearly six-month high for the price of oil as sources said Gulf OPEC members were ready to raise output only if there was demand before offsetting any shortfall following a US decision to end waivers for buyers of Iranian crude. US crude oil futures settled 1.1pc higher at $66.30 a barrel.

Canadian government bond prices were higher across the yield curve in sympathy with US Treasuries. The two year  rose 8.5 Canadian cents to yield 1.576pc and the 10-year was up 27 Canadian cents to yield 1.758pc.

Canada's two-year yield fell 1.9 basis points further below the yield on the equivalent US bond to a spread of -78.8 basis points, its widest since March 22.