Forexpros – The U.S. dollar rose to an eleven-day high against its Canadian counterpart on Thursday, after better-than-expected U.S. employment data and disappointing Canadian data on retail sales.
USD/CAD hit 0.999 during European afternoon trade, the pair’s highest since March 7; the pair subsequently consolidated at 1.0006, climbing 0.84%.
The pair was likely to find support at 0.9900, the low of March 16 and resistance at 1.0027, the high of March 6.
The U.S. Department of Labor said earlier that the number of individuals filing for initial jobless benefits in the week ending March 17 fell to 348,000, the lowest level since February 2008.
Meanwhile, in Canada, official data showed that retail sales rose less-than-expected in January, rising 0.5% after a flat reading the previous month. Analysts had expected retail sales to rise 1.8% in January.
But sentiment on the loonie remained weak after data showed that manufacturing activity in the euro zone slumped unexpectedly in March, remaining in contraction territory for the eighth consecutive month, sparking concerns that the region’s economy is sliding back into a
recession.
Service sector activity in the euro zone declined to the lowest level in four months in March.
The data came after a report showing that Chinese manufacturing activity contracted for a fifth consecutive month, underlining concerns over a possible slowdown in growth in the world’s second largest economy.
The Canadian dollar also came under pressure as crude oil for delivery in March tumbled 2.13% to trade at USD104.95 a barrel on the New York Mercantile Exchange.
Raw materials, including oil account for about half of Canada’s export revenue.
The loonie was also lower against the euro with EUR/CAD adding 0.33%, to hit 1.3158.
Later in the day, Federal Reserve Chairman Ben Bernanke was due to speak.
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