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Forex – USD/CAD pares losses after weak Canadian PMI data

Published 11/04/2010, 10:13 AM
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Investing.com – The U.S. dollar pared losses against its Canadian counterpart on Thursday, retreating from a 3-week low following the release of worse than expected Canadian PMI data.

USD/CAD clawed up from 1.0009, the pair's lowest since October 14 to hit 1.0041 during European afternoon trade, shedding 0.10%.

The pair was likely to find support at 0.9979, the low of October 14 and a 6-month low and resistance at 1.0155, Wednesday’s high.

Earlier in the day, data showed that Canada's Ivey purchasing managers’ index fell significantly more-than-expected in October.

In a report, the Richard Ivey School of Business said its purchasing managers’ index fell to 56.7 in October, after rising to 70.3 in September. Analysts had expected the index to fall to 69.7 in October.

On the index, a figure above 50.0 indicates industry expansion, below indicates contraction.

Meanwhile, the loonie was down against the euro, with EUR/CAD surging 0.69% to hit 1.4311.

Earlier Thursday, the U.S. Department of Labor said the number of individuals filing for initial jobless benefits rose last week to a seasonally adjusted 457K, after falling to a revised 437K in the preceding week. Analysts had expected initial jobless claims to remain unchanged last week.

The downbeat data came on the heels of the Federal Reserve announcement late Wednesday that it would buy USD 600 billion of U.S. government bonds over the next eight months in an effort to kick-start a "disappointingly slow" economic recovery.

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