Investing.com - The U.S. dollar fell against its Canadian counterpart on Wednesday, pulling away from an 11-year peak, as downbeat reports on U.S. private sector employment and trade dampened expectations for a September rate hike by the Federal Reserve.
USD/CAD hit 1.3114 during early U.S. trade, the session low; the pair subsequently consolidated at 1.3137, retreating 0.41%.
The pair was likely to find support at 1.2940, the low of July 31 and resistance at 1.3344.
Payroll processing firm ADP said non-farm private employment rose 185,000 last month, below expectations for an increase of 215,000. The economy created 229,000 jobs in June, whose figure was downwardly revised from a previously reported increase of 237,000.
Separately, the U.S. Bureau of Economic Analysis said that the trade deficit widened to $43.84 billion in June from $40.94 billion in May, whose figure was revised from a previously reported deficit of $40.7 billion.
Analysts had expected the U.S. trade deficit to widen to $42.8 billion in June.
The greenback had strengthened broadly earlier, after Federal Reserve Bank of Atlanta President Dennis Lockhart said Tuesday it would take a “significant deterioration in the economic picture” for him to not support a rate hike in September.
Investors were now turning their attention to the upcoming U.S. jobs report for July, which could reinforce expectations for higher interest rates.
In Canada, official data on Wednesday showed that the trade deficit was C$480 million in June, compared to a deficit of C$3.37 billion in May, whose figure was revised from a previously reported deficit of C$3.34 billion.
Analysts had expected Canada to post a trade deficit of C$2.8 billion in June.
The loonie was also higher against the euro, with EUR/CAD shedding 0.29% to 1.4312.
Also Wednesday, data showed that euro zone service sector growth slowed in July, as activity in France and Italy slowed.
The euro area services purchasing managers' index fell to 53.9 from June’s four year high of 54.2.
Another report showed that retail sales in the region fell by a larger than forecast 0.6% in June.