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Forex - USD/CAD rises to 2-month highs after Canada, U.S. data

Published 11/08/2013, 09:26 AM
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Investing.com - The U.S. dollar rose to two-month highs against its Canadian counterpart on Friday, as disappointing Canadian jobs data dented demand for the loonie, while an upbeat jobs report from the U.S. lent broad support to the greenback.

USD/CAD hit 1.0502 during early U.S. trade, the pair's highest since September 5; the pair subsequently consolidated at 1.0499, rising 0.39%.

The pair was likely to find support at 1.0446, the session low and resistance at 1.0542, the high of September 4.

Official data showed that the Canadian economy added 13,200 jobs in October, disappointing expectations for a 14,000 increase, after a 11,900 rise the previous month.

Canada's unemployment rate remained unchanged at 6.9% last month, confounding expectations for an uptick to 7.0%.

Meanwhile, the greenback found support after the Bureau of Labor Statistics said the U.S. economy added 204,000 jobs in October, beating expectations for a 125,000 increase, after an upwardly revised 163,000 rise the previous month.

The U.S. unemployment rate ticked up to 7.3% last month, from 7.2% in September, in line with expectations.

The strong data added to expectations that the Fed could begin scaling back its asset purchase program as soon as next month, after a report on Thursday showed that U.S. gross domestic product grew at a seasonally adjusted annual rate of 2.8% in the three months to September, beating expectations for growth of 2%.

The loonie was higher against the euro with EUR/CAD slipping 0.11%, to hit 1.0420.

Also Friday, official data showed that Germany's trade surplus widened to EUR18.8 billion in September, from EUR15.8 billion the previous month, which was revised up from EUR15.6 billion. Analysts had expected the trade surplus to narrow to EUR15.5 billion in September.

Separately, France’s credit rating was lowered to AA from AA+ by Standard & Poor's. The ratings company said slower growth will constrain the government’s ability to improve public finances.

Later in the day, the University of Michigan was to release the preliminary reading of its consumer sentiment index.


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