Investing.com – The broadly weaker U.S. dollar traded below parity against its Canadian counterpart on Thursday, dropping to a five week low as better-than-expected U.S. GDP data and a European plan to tackle the region's two-year old debt crisis fuelled a rally in risk-sensitive assets.
USD/CAD hit 0.9915 during U.S. morning trade, the pair’s lowest since September 21; the pair subsequently consolidated at 0.9945, tumbling 0.96%.
The pair was likely to find short-term support at 0.9908, the low of September 21 and resistance at 1.0175, Wednesday’s high.
The U.S. Bureau of Economic Analysis said in a report earlier that gross domestic product rose by 2.5% in the third quarter, the fastest pace since the third quarter of 2010.
The reading nearly doubled growth of 1.3% recorded in the preceding quarter. Analysts had expected U.S. gross domestic product to rise 2.4% in the third quarter.
Meanwhile, European leaders announced early Thursday that they reached an agreement with banks to take a 50% writedown on the face value of their Greek debt holdings, easing pressure on the debt-laden country.
Additionally, euro zone leaders agreed to enhance the size of the European Financial Stability Facility, the region’s bailout fund, to EUR1 trillion, while a plan to recapitalize the region’s banks was also agreed upon.
The loonie found further support after crude oil for delivery in December surged 2.85% to trade at USD92.78 a barrel on the New York Mercantile Exchange.
Raw materials, including oil account for about half of Canada’s export revenue.
The greenback briefly pared losses after data showed that pending home sales in the U.S. fell for the third consecutive month in September, declining by 4.6%. Analysts had expected pending home sales to rise by 0.2%.
Elsewhere, the Canadian dollar was down against the euro, with EUR/CAD jumping 0.63% to hit 1.4053.
Also Thursday, the U.S. Department of Labor said the number of individuals filing for initial jobless benefits last week fell by 2,000 to 402,000, short of expectations for a decline to 400,000.
USD/CAD hit 0.9915 during U.S. morning trade, the pair’s lowest since September 21; the pair subsequently consolidated at 0.9945, tumbling 0.96%.
The pair was likely to find short-term support at 0.9908, the low of September 21 and resistance at 1.0175, Wednesday’s high.
The U.S. Bureau of Economic Analysis said in a report earlier that gross domestic product rose by 2.5% in the third quarter, the fastest pace since the third quarter of 2010.
The reading nearly doubled growth of 1.3% recorded in the preceding quarter. Analysts had expected U.S. gross domestic product to rise 2.4% in the third quarter.
Meanwhile, European leaders announced early Thursday that they reached an agreement with banks to take a 50% writedown on the face value of their Greek debt holdings, easing pressure on the debt-laden country.
Additionally, euro zone leaders agreed to enhance the size of the European Financial Stability Facility, the region’s bailout fund, to EUR1 trillion, while a plan to recapitalize the region’s banks was also agreed upon.
The loonie found further support after crude oil for delivery in December surged 2.85% to trade at USD92.78 a barrel on the New York Mercantile Exchange.
Raw materials, including oil account for about half of Canada’s export revenue.
The greenback briefly pared losses after data showed that pending home sales in the U.S. fell for the third consecutive month in September, declining by 4.6%. Analysts had expected pending home sales to rise by 0.2%.
Elsewhere, the Canadian dollar was down against the euro, with EUR/CAD jumping 0.63% to hit 1.4053.
Also Thursday, the U.S. Department of Labor said the number of individuals filing for initial jobless benefits last week fell by 2,000 to 402,000, short of expectations for a decline to 400,000.