Forexpros – The U.S. dollar remained little changed against the Canadian dollar on Thursday, hovering just above a three-month low as mixed U.S. economic data underpinned expectations for more easing by the Federal Reserve.
USD/CAD hit 0.9883 during early U.S. trade, the pair’s lowest since May 4; the pair subsequently consolidated at 0.9888, dipping 0.04%.
The pair was likely to find support at 0.9860, the low of May 4 and resistance at 0.9934, Wednesday’s high.
The Department of Labor said the number of people who filed for unemployment assistance in the U.S. last week rose to 366,000, a four-week high and slightly above expectations for an increase to 365,000.
In a separate report, the U.S. Commerce Department said housing starts fell by 1.1% in July to a seasonally adjusted 0.746 million last month, compared to expectations for a decline of 0.5% to 0.757 million.
But the number of building permits issued in July rose 6.8% to 0.812 million, compared to expectations for an increase of 1.2% to 0.770 million.
The reports sparked fresh speculation that the Federal Reserve may turn to fresh stimulus measures in the near future to shore up growth.
The data came after significantly stronger-than-expected U.S. retail sales numbers for July earlier in the week tempered expectations for another round of quantitative easing by the U.S. central bank.
In Canada, official data showed that manufacturing sales fell by 0.4% in June, missing expectations of a monthly gain of 0.4%, following a significant drop in sales of petroleum and coal products.
Another report showed that international investors sold CAD7.89 billion of Canadian assets in June, defying expectations for purchases of CAD10.67 billion.
Trade remained thin, with many market participants away for summer holidays.
The Canadian dollar looked likely to remain supported well above parity after Bank of Canada Governor Mark Carney indicated last week that the central bank may raise interest rates.
The loonie, as the Canadian dollar is also known, was down against the euro, with EUR/CAD up 0.35% to 1.2201.
Later Thursday, the U.S. was to release official data on manufacturing activity in the Philadelphia area.
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