Investing.com - The U.S. dollar pared losses against its Canadian counterpart on Thursday, boosted by the release of strong U.S. economic reports, although rising oil prices still supported demand for the commodity-related Canadian currency.
USD/CAD eased off 1.3400, the pair’s lowest since November 10, to hit 1.3412 during early U.S. trade, still down 0.27%.
The pair was likely to find support at 1.3380, the low of November 10 and resistance at 1.3506, Wednesday’s high.
The U.S. Department of Labor said initial jobless claims in the week ending November 12 fell by 19,000 to 235,000 from the previous week’s total of 254,000. It was the lowest level since 1973.
Analysts expected jobless claims to rise by 3,000 to 257,000 last week.
Separately, the Commerce Department said housing starts surged 25% in October to hit 1.323 million units, compared tp expectations for a rise of 7.0%.
U.S. building permits rose 0.3% last month to 1.229 million units, beating expectations for a 2.9% decline.
Data also showed that U.S. consumer prices rose 0.4% in October, in line with expectations. Year-over-year, consumer prices increased by 1.6% last month, its highest reading since October 2014.
Core CPI, which excludes food and energy costs, increased 0.1% last month, below forecasts for a 0.2% rise.
The upbeat data added to optimism over the strength of the U.S. economy and fueled further expectations for a Decenber rate hike by the Federal Reserve.
Earlier in the day, Fed Chair Janet Yellen warned of the danger of waiting too long to tighten monetary policy.
The comments came a day after Philadelphia Fed head Patrick Harker said that he was in favor of raising interest rates, while Cleveland Fed President Loretta Mester said the Fed must not overreact to market moves following the shock result of the presidential election.
On a less positive note, the Philadelphia Federal Reserve said on Thursday that its manufacturing index fell to 7.6 this month from 9.7 in October, confounding expectations for a reading of 8.0.
At the same time, Statistics Canada reported that foreign securities purchases rose by C$11.77 billion in September, disappointing expectations for an increase of C$12.20 billion.
But the Canadian dollar remained supported as oil prices rallied on Thursday, after Saudi Energy Minister Khalid al-Falih said he was optimistic that OPEC would formalize its oil output deal.
The loonie was steady against the euro, with EUR/CAD at 1.4367.