Canadian Dollar Pares Recent Gains Against Majors
The Canadian dollar that showed some strength against its major counterparts in the early North American session on Tuesday pared some of its gains shortly as crude oil prices retreated after rising above the $71 per barrel.
Crude oil for October delivery is currently trading at $70.56 per barrel. Prices touched as high as $71.37 earlier in the session. Traders awaited the release of the Energy Information Administration inventory report tomorrow.
The Canadian dollar that edged higher to 1.5628 against the euro by 10:35 am ET lost some ground shortly. The loonie is presently quoted at 1.5686 against the euro, compared to Monday’s close of 1.5683.
In economic news from Europe, a key indicator for Eurozone manufacturing activity increased to a 14-month high of 48.2 in August from 46.3 in July, rising more than initially estimated, a report by Markit Economics said today.
Eurostat said in a report that Eurozone jobless rate stood at 9.5% in July, up from 9.4% in the previous month. This was the highest jobless rate since May 1999 and in line with economists’ expectations. A year ago, the jobless rate was 7.5%.
German retail sales recorded a monthly growth in July after declining in the previous two months, official data showed today. Retail turnover rose by a real 0.7% month-on-month in July after falling 1.3% in June, provisional results from the Federal Statistical Office showed today. Annually, retail sales slipped 1%, slightly slower than the expected decline of 1.2%.
Retreating from its Asian session’s 4-day high, the Canadian dollar drifted lower to 84.58 against the Japanese yen by 11:25 am ET. The loonie-yen pair is presently worth 84.71, compared to 85.18 hit late New York Monday.
Pulling back from its Asian session’s 4-day high, the Canadian dollar declined to 1.102 against the US dollar by 11:25 pm ET. On the downside, support is seen around the 1.11 level for the loonie. The greenback-loonie pair, which closed trading on Monday at 1.0939, is currently quoted at 1.1005.
In the U.S., the Institute for Supply Management released a report today showing that its manufacturing index jumped to 52.9 in August from 48.9 in July, with a reading above 50 indicating an expansion in the sector. Economists had expected the index to edge up to a reading of 50.2.
The National Association of Realtors said its pending home sales index rose 3.2 percent to 97.6 in July from a reading of 94.6 in June. With the increase, which exceeded economist estimates of 1.5 percent growth, the index rose to its highest level since June of 2007.
The Commerce Department released a report today showing that construction spending fell 0.2 percent in July following a downwardly revised 0.1 percent increase in June. Economists had expected spending to fall 0.2 percent compared to the 0.3 percent increase originally reported for the previous month.
