TORONTO – The Canadian dollar was slightly lower Tuesday amid rising commodity prices.

The loonie dipped 0.07 of a cent to 95.3 cents US after going as low as 94.75 cents Monday, its lowest level since October, 2011.

The resource-based currency has sustained a series of sharp losses lately amid a greenback that has strengthened since U.S. Federal Reserve chairman Ben Bernanke indicated last week that the central bank could be set to start winding up a key element of its economic stimulus. Those purchases of US$85 billlion a month have kept long term rates low and fuelled a rally on many stock markets.

Yields have spiked to almost two year highs — as much as 2.6 per cent on Monday. The yield on the benchmark 10-year Treasury stood at 2.25 per cent last Wednesday before Fed chairman Ben Bernanke indicated that the Fed could start winding up the bond buying program later this year.

Traders also gauged the effect from China raising its interbank lending rate to over 13 per cent as part of an effort to trim off-balance-sheet lending that could threaten the financial stability of the world’s second-largest economy. But markets feared the move could also hurt economic growth. China’s major state-owned banks are unwilling to lend to any but their biggest clients, so the vast majority of smaller businesses must rely on informal lending.

Commodity prices were positive following a series of steep losses caused by demand concerns and the higher U.S. currency. The July copper contract on the New York Mercantile Exchange was ahead four cents at US$3.07 a pound.

August crude on the Nymex was 50 cents higher to US$95.68 a barrel.

And August bullion rose $7.60 to US$1,84.70 an ounce.