Investing.com – The U.S. dollar jumped to a one-week high against its Canadian counterpart on Tuesday, as renewed concerns over the debt crisis in the euro zone saw investors abandon higher-yielding assets for the safety of the greenback.
USD/CAD hit 1.0185 during early U.S. trade, the pair’s highest since October 25; the pair subsequently consolidated at 1.0155, leaping 1.51%.
The pair was likely to find support at 0.9972, the day’s low and short-term resistance at 1.0212, the high of October 25.
Risk appetite was hit after Greek Prime Minister George Papandreou announced a surprise referendum on Greece's bailout program. If Greece rejects the deal it could move the country closer to a sovereign default, increasing the risk of contagion in global financial markets.
Market sentiment was also dampened after government data showed that Chinese manufacturing activity fell to its lowest level since February 2009 in October, while the Reserve Bank of Australia's decision to cut interest rates for the first time in more than two years underlined concerns over weakness in the global economy.
The broadly stronger dollar weighed on crude oil prices, with the December crude contract on the New York Mercantile Exchange plunging 3.37% to trade at a six-day low of USD90.05 a barrel.
Raw materials, including oil account for about half of Canada’s export revenue.
The Canadian dollar was slightly higher against the euro, with EUR/CAD slipping 0.11% to hit 1.3853.
Later Tuesday, the Institute of Supply Management was to produce a report on U.S. manufacturing activity.
USD/CAD hit 1.0185 during early U.S. trade, the pair’s highest since October 25; the pair subsequently consolidated at 1.0155, leaping 1.51%.
The pair was likely to find support at 0.9972, the day’s low and short-term resistance at 1.0212, the high of October 25.
Risk appetite was hit after Greek Prime Minister George Papandreou announced a surprise referendum on Greece's bailout program. If Greece rejects the deal it could move the country closer to a sovereign default, increasing the risk of contagion in global financial markets.
Market sentiment was also dampened after government data showed that Chinese manufacturing activity fell to its lowest level since February 2009 in October, while the Reserve Bank of Australia's decision to cut interest rates for the first time in more than two years underlined concerns over weakness in the global economy.
The broadly stronger dollar weighed on crude oil prices, with the December crude contract on the New York Mercantile Exchange plunging 3.37% to trade at a six-day low of USD90.05 a barrel.
Raw materials, including oil account for about half of Canada’s export revenue.
The Canadian dollar was slightly higher against the euro, with EUR/CAD slipping 0.11% to hit 1.3853.
Later Tuesday, the Institute of Supply Management was to produce a report on U.S. manufacturing activity.