Investing.com - The U.S. dollar was lower against its Canadian counterpart on Wednesday, after the release of Canadian and U.S. trade balance data, although expectations for the Federal Reserve to soon begin tapering its stimulus program still supported the greenback.
USD/CAD hit 1.0479 during early U.S. trade, the pair's lowest since August 28; the pair subsequently consolidated at 1.0507, shedding 0.25%.
The pair was likely to find support at 1.0396, the low of August 21 and resistance at 1.0560, Tuesday's high.
Official data showed that Canada's trade deficit widened to CAD0.9 billion in July, from an upwardly revised deficit of CAD0.4 billion the previous month, confounding expectations for the deficit to widen to CAD1 billion.
In the U.S.,data showed that the trade deficit widened more-than-expected in July, falling to USD39.2 billion from a downwardly revised USD34.5 billion deficit the previous month. Analysts had expected the trade deficit to widen to USD38.7 billion in July.
The data came as investors continued to speculate over the timing of the Fed's widely expected reduction in monthly bond purchases after data on Tuesday showed that manufacturing activity in the U.S. expanded at the fastest rate since April 2011 in August.
Investors were now looking ahead to Friday’s highly-anticipated U.S. nonfarm payrolls report which is seen as key to the Fed’s decision on tapering.
Meanwhile, investors remained cautious after top congressional leaders, including Republican House Speaker John Boehner and Democrat Nancy Pelosi said they would back President Obama's call for military intervention in Syria.
The loonie was higher against the euro with EUR/CAD sliding 0.28%, to hit 1.3837.
In the euro zone, data earlier showed that the final reading of Germany’s services purchasing managers' index came in at 52.8 in August, up from a preliminary reading of 52.4. The euro zone’s services PMI dipped to 50.7, from an initial estimate for 51.0.
Later in the day, the Bank of Canada was to announce its benchmark interest rate and publish its rate statement.
USD/CAD hit 1.0479 during early U.S. trade, the pair's lowest since August 28; the pair subsequently consolidated at 1.0507, shedding 0.25%.
The pair was likely to find support at 1.0396, the low of August 21 and resistance at 1.0560, Tuesday's high.
Official data showed that Canada's trade deficit widened to CAD0.9 billion in July, from an upwardly revised deficit of CAD0.4 billion the previous month, confounding expectations for the deficit to widen to CAD1 billion.
In the U.S.,data showed that the trade deficit widened more-than-expected in July, falling to USD39.2 billion from a downwardly revised USD34.5 billion deficit the previous month. Analysts had expected the trade deficit to widen to USD38.7 billion in July.
The data came as investors continued to speculate over the timing of the Fed's widely expected reduction in monthly bond purchases after data on Tuesday showed that manufacturing activity in the U.S. expanded at the fastest rate since April 2011 in August.
Investors were now looking ahead to Friday’s highly-anticipated U.S. nonfarm payrolls report which is seen as key to the Fed’s decision on tapering.
Meanwhile, investors remained cautious after top congressional leaders, including Republican House Speaker John Boehner and Democrat Nancy Pelosi said they would back President Obama's call for military intervention in Syria.
The loonie was higher against the euro with EUR/CAD sliding 0.28%, to hit 1.3837.
In the euro zone, data earlier showed that the final reading of Germany’s services purchasing managers' index came in at 52.8 in August, up from a preliminary reading of 52.4. The euro zone’s services PMI dipped to 50.7, from an initial estimate for 51.0.
Later in the day, the Bank of Canada was to announce its benchmark interest rate and publish its rate statement.