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Forex - USD/CAD re-approaches 2-1/2 month peak in early trade

Published 07/03/2015, 09:27 AM
Greenback rises near 2-1/2 month highs vs. loonie in cautious trade
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Investing.com - The U.S. dollar rose against its Canadian counterpart on Friday, re-approaching a two-and-a-half month peak, as concerns over a potential Greek exit from the euro zone continued to dampen market sentiment and as the drop in crude oil prices weighed on the Canadian currrency.

Trading volumes were expected to remain thin with U.S. markets closed for a national holiday

USD/CAD hit 1.2600 during early U.S. trade, the session high; the pair subsequently consolidated at 1.2594, gaining 0.43%.

The pair was likely to find support at 1.2475, the low of July 1 and resistance at 1.2633, Thursday's high.

Markets were jittery after a last minute deal between Greece and the euro zone were quashed on Wednesday when Greek Prime Minister Alexis Tsipras urged voters to reject the terms of an international bailout deal.

Greek voters are due to decide on Sunday whether to accept terms proposed by the institutions overseeing the country’s now-expired bailout, the European Central Bank, the International Monetary Fund and the European Commission, or reject them.

Greece became the first developed country to default on the IMF after its second bailout program expired late Tuesday.

Meanwhile, the commodity-linked Canadian dollar was also hit by the drop in crude oil prices, which reached fresh two-months lows of $56.45 on Friday.

The loonie was also lower against the euro, with EUR/CAD advancing 0.59% to 1.3981.

Earlier in the day, official data showed that euro zone retail sales rose 0.2% in May, beating expectations for a 0.1% uptick, after a 0.7% gain the previous month.

Year-on-year, retail sales increased by 2.4% in May, more than the expected 2.3% rise, after a 2.2% gain in April.

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