Investing.com - The U.S. dollar edged higher against the Canadian dollar on Tuesday, as sentiment on the greenback was boosted by hopes that a breakthrough in the political deadlock in Washington may be close.
USD/CAD hit 1.0368 during early U.S. trade, the session high; the pair subsequently consolidated at 1.0364, easing up 0.11%.
The pair was likely to find support at 1.0330, the session low and resistance at 1.0385.
The greenback found support after Senate Majority Leader Harry Reid said Monday that “tremendous progress” had been made towards a deal to raise the U.S. debt ceiling and reopen the federal government, fuelling hopes that a compromise can be reached.
If an agreement to raise the government borrowing limit is not struck ahead of Thursday’s deadline, the U.S. will face an unprecedented sovereign debt default.
However, any potential deal will still have to be approved by the House of Representatives, where Speaker John Boehner would have to decide whether to allow a vote or demand federal spending cuts.
Meanwhile, data released on Tuesday showed that an index of manufacturing activity in the New York region came in below expectations this month.
The Federal Reserve Bank of New York said that its general business conditions index fell to 1.52 in the current month from 6.29 in September. Analysts had expected a reading of 7.0.
Elsewhere, the loonie, as the Canadian dollar is also known, was higher against the euro, with EUR/CAD shedding 0.38% to trade at 1.3981.
The single currency shrugged off data showing that German economic sentiment improved more-than-expected in October, rising to the highest level since April 2010.
The ZEW Centre for Economic Research said that its index of German economic sentiment rose by 3.2 points to hit 52.8 in October from September’s reading of 49.6. Analysts had expected an unchanged reading.
USD/CAD hit 1.0368 during early U.S. trade, the session high; the pair subsequently consolidated at 1.0364, easing up 0.11%.
The pair was likely to find support at 1.0330, the session low and resistance at 1.0385.
The greenback found support after Senate Majority Leader Harry Reid said Monday that “tremendous progress” had been made towards a deal to raise the U.S. debt ceiling and reopen the federal government, fuelling hopes that a compromise can be reached.
If an agreement to raise the government borrowing limit is not struck ahead of Thursday’s deadline, the U.S. will face an unprecedented sovereign debt default.
However, any potential deal will still have to be approved by the House of Representatives, where Speaker John Boehner would have to decide whether to allow a vote or demand federal spending cuts.
Meanwhile, data released on Tuesday showed that an index of manufacturing activity in the New York region came in below expectations this month.
The Federal Reserve Bank of New York said that its general business conditions index fell to 1.52 in the current month from 6.29 in September. Analysts had expected a reading of 7.0.
Elsewhere, the loonie, as the Canadian dollar is also known, was higher against the euro, with EUR/CAD shedding 0.38% to trade at 1.3981.
The single currency shrugged off data showing that German economic sentiment improved more-than-expected in October, rising to the highest level since April 2010.
The ZEW Centre for Economic Research said that its index of German economic sentiment rose by 3.2 points to hit 52.8 in October from September’s reading of 49.6. Analysts had expected an unchanged reading.