Forexpros – The U.S. dollar was lower against its Canadian counterpart on Monday, as news that Spain is to receive a bailout for its banking sector continued to support demand for higher-yielding assets.
USD/CAD hit 1.0201 during early U.S. trade, the pair’s lowest since May 22; the pair subsequently consolidated at 1.0241, shedding 0.17%.
The pair was likely to find support at 1.0137, the low of May 21 and resistance at 1.0258, the session high.
Investor sentiment was boosted after Spain secured a loan of up to EUR100 billion from the European Union, which the government will use to recapitalize the country’s ailing banks.
But demand for the safe haven greenback remained supported as details of the Spanish bailout agreement remained unclear, with the exact amount Madrid will receive to be decided after the results of independent banking audits are published later this month.
Meanwhile, investors remained focused on the outcome of a Greek general election this weekend, which could determine if the country is to remain on in the euro zone.
Elsewhere, Sunday’s unexpectedly strong Chinese import and export data eased concerns over a ‘hard landing’ in the world’s second largest economy, following a surprise interest rate by the country’s central bank last week.
The loonie, as the Canadian dollar is sometimes known, was slightly lower against the euro, with EUR/CAD edging up 0.12% to hit 1.2859.
Neither Canada or the U.S. were scheduled to release any economic data on Monday, so markets were likely to continue to look to events in the euro zone for guidance.
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