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Forex - USD/CAD rises to fresh 6-year highs in early trade

Published 07/22/2015, 09:28 AM
Greenback hits fresh multi-year peak vs. loonie ahead of U.S. data
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Investing.com - The U.S. dollar rose to fresh six-year highs against its Canadian counterpart on Wednesday, as demand for the greenback strengthened ahead of U.S. existing home sales data due later in the trading session.

USD/CAD hit 1.3042 during early U.S. trade, the pair's highest since March 2009; the pair subsequently consolidated at 1.3038, advancing 0.73%.

The pair was likely to find support at 1.2913, Tuesday's low and resistance at 1.3063.

The greenback strengthened as markets awaited the upcoming release of U.S. existing home sales data for further indications on the strength of the economy.

Demand for the U.S. dollar has remained broadly supported since Federal Reserve Chair Janet Yellen said last week that the Fed is likely to raise rates "at some point this year."

Meanwhile, an ongoing downward trend in oil prices continued to weigh on the commodity-linked Canadian dollar. On the New York Mercantile Exchange, crude oil for September delivery hit a three-month low of $50.13 during U.S. early morning hours, down 73 cents, or 1.42%.

The loonie was also lower against the euro, with EUR/CAD rising 0.37% to 1.4210.

Sentiment on the single currency remained vulnerable as the Greek parliament was set to vote later Wednesday on a second set of reforms needed to secure the country's bailout deal.

If lawmakers approve the financial and judicial reforms, Greece will be able to press ahead with negotiations for an €86 billion bailout from its creditors.

Greece's next major deadline is August 20, when it must pay €3.2 billion owed to the European Central Bank, followed by a payment of €1.5 billion to the International Monetary Fund in September.

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