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Forex - USD/CAD re-approaches 6-week highs after U.S., Canada GDP data

Published 05/29/2015, 09:24 AM
© Reuters.  Greenback rises against loonie, moves close to 6-week peak
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Investing.com - The U.S. dollar rose against its Canadian counterpart on Friday, re-approaching a six-week peak after data showed that the U.S. economy slowed slightly less than expected in the first quarter, while Canada's economic growth contracted unexpectedly in March.

USD/CAD hit 1.2518 during early U.S. trade, the session high; the pair subsequently consolidated 1.2522, advancing 0.72%.

The pair was likely to find support at 1.2395, the low of May 27 and resistance at 1.2570, the high of April 15.

In a preliminary report, the U.S. Bureau of Economic Analysis said gross domestic product slipped 0.7% in the first three months of 2015, compared to expectations for a 0.8% decline and following a growth rate of 0.2% in the last quarter of 2014.

The data came after economic data released in the past week, including reports on inflation, new home sales, business investment and consumer confidence all indicated that the U.S. economy is gaining momentum.

At the same time, official data showed that Canada's GDP slipped 0.2% in March, confounding expectations for an increase of 0.2%, after a 0.1% fall from the previous month.

The loonie was lower against the euro, with EUR/CAD climbing 0.83% to 1.3727.

Earlier Friday, official data showed that German retail sales rose 1.7% last month, beating expectations for a 0.8% gain. The change in retail sales for March was revised to a 1.4% decline from a previously estimated 2.3% drop.

Separately, a preliminary report showed that Spanish consumer prices slipped 0.2% this month, compared to expectations for a 0.5% decline, after a 0.6% fall in April.

But investors remained cautious after Greece's creditors said a deal to unlock rescue aid isn't imminent. Athens had claimed a solution could be reached by Sunday.

Later in the day, the University of Michigan was to report on U.S. consumer sentiment.

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