USD/CAD holds weaker around mid-1.2800

   •  CAD remains underpinned by Friday’s stronger consumer inflation figures.
   •  Subdued USD demand helps offset weaker oil prices and rising US bond yields.

The USD/CAD pair came under some fresh selling pressure at the start of a new trading week and hangs closer to near two-week lows, set on Friday.

The pair struggled to build on Friday's late recovery from an intraday low level of 1.2824, touched in the aftermath of stronger than expected Canadian inflation figures, and continues to be weighed down by the prevalent weaker tone around the US Dollar.  

Even a goodish pickup in the US Treasury bond yields did little to revive the greenback demand and extend any support to the major. Traders also seemed to have shrugged off a sharp retracement in crude oil prices, which tends to dent demand for the commodity-linked currency - Loonie, with the USD price dynamics acting as an exclusive driver of the pair's weaker tone through the early European session.

In absence of any major market moving economic releases, the scheduled speeches by influential FOMC members might influence the USD price dynamics and eventually provide some short-term trading impetus.

Technical levels to watch

Any subsequent weakness below the 1.2830-25 immediate support is likely to find some buying interest near the 1.2800 handle, below which the pair seems to extend the downfall towards testing the 1.2700 handle.

On the upside, the 1.2880-90 region now seems to have emerged as an immediate hurdle, which if cleared might prompt some short-covering move and lift the pair back towards the 1.2940-45 supply zone.