The Canadian Dollar (CAD) strengthened to a six-week high against its US counterpart on Tuesday as investors raised bets on additional interest rate hikes by the Bank of Canada following hotter-than-expected inflation data.

Canada’s annual inflation rate in August jumped to 4.0% from 3.3% in July on higher gasoline prices. Analysts polled by Reuters had forecast inflation would hit 3.8%.

“Today’s above-consensus print is likely to lift market-implied odds on a final hike at the Bank of Canada’s October meeting, and the oversold nature of the Canadian dollar going into the release suggests that exchange rate gains could be generated in the shorter term,” Karl Schamotta, chief market strategist at Corpay, said in a note.

Speculators have raised their bearish bets on the Canadian dollar to the highest since May, data from the U.S. Commodity Futures Trading Commission showed on Friday.

Money markets see a roughly 40% chance that the Canadian central bank will tighten next month, up from 23% before the inflation data.

Earlier this month, the BoC left its benchmark rate on hold at a 22-year high of 5% but said it could raise borrowing costs again should inflationary pressures persist.

The Canadian dollar was trading 0.7% higher at 1.3387 to the greenback, or 74.70 U.S. cents, after touching its strongest intraday level since Aug. 10 at 1.3383.

Higher oil prices added to support for the loonie. U.S. crude oil futures were up 2% at $93.31 a barrel, extending recent gains, while the US dollar (.DXY) lost ground against a basket of major currencies.

Canadian government bond yields climbed across the curve. The 10-year was up 11.9 basis points at 3.871%, its highest since October 2008.