Investing.com - The U.S. dollar edged lower against the Canadian dollar on Wednesday but remained supported close to two-month highs as expectations that the Federal Reserve may soon start tapering stimulus underpinned dollar demand.
USD/CAD inched down 0.05% to 1.0488 during early U.S. trade, holding below the two month high of 1.0507 hit on Tuesday.
The pair was likely to find support at 1.0462, Tuesday’s low and near-term resistance at 1.0507.
The greenback remained supported after last week’s stronger than forecast U.S. nonfarm payrolls report prompted investors to bring forward expectations for a reduction in the Fed’s USD85 billion-a-month asset purchase program.
Investors were turning their attention to Thursday’s Senate hearing to confirm Janet Yellen as the first chairwoman of the Federal Reserve, for indications on the future course of U.S. monetary policy.
Elsewhere, the loonie, as the Canadian dollar is also known, was almost unchanged against the euro in subdued trade, with EUR/CAD dipping 0.02% to 1.4093.
In the euro zone, data released on Wednesday showed that industrial production fell 0.5% in September from a month earlier, but was 1.1% higher on a year-over-year basis. Economists had forecast a monthly decline of 0.3% and an annual increase of 0.2%.
Meanwhile, official data showing that the annual rate of inflation in Spain fell by 0.1% in October added to fears over growing deflationary pressures in the euro area. The downward trend in inflation prompted the European Central Bank to cut rates to a record low 0.25% last week.
USD/CAD inched down 0.05% to 1.0488 during early U.S. trade, holding below the two month high of 1.0507 hit on Tuesday.
The pair was likely to find support at 1.0462, Tuesday’s low and near-term resistance at 1.0507.
The greenback remained supported after last week’s stronger than forecast U.S. nonfarm payrolls report prompted investors to bring forward expectations for a reduction in the Fed’s USD85 billion-a-month asset purchase program.
Investors were turning their attention to Thursday’s Senate hearing to confirm Janet Yellen as the first chairwoman of the Federal Reserve, for indications on the future course of U.S. monetary policy.
Elsewhere, the loonie, as the Canadian dollar is also known, was almost unchanged against the euro in subdued trade, with EUR/CAD dipping 0.02% to 1.4093.
In the euro zone, data released on Wednesday showed that industrial production fell 0.5% in September from a month earlier, but was 1.1% higher on a year-over-year basis. Economists had forecast a monthly decline of 0.3% and an annual increase of 0.2%.
Meanwhile, official data showing that the annual rate of inflation in Spain fell by 0.1% in October added to fears over growing deflationary pressures in the euro area. The downward trend in inflation prompted the European Central Bank to cut rates to a record low 0.25% last week.