Investing.com - The U.S. dollar ended last week trading close to a seven-month low against its Canadian counterpart, following the release of weaker-than-forecast U.S. first quarter growth data, while expectations for higher interest rates buoyed the Canadian dollar.
USD/CAD hit 0.9978 on Monday, the weekly high; the pair subsequently consolidated at 0.9802 by close of trade on Friday, tumbling 1.13% over the week.
The pair is likely to find support at 0.9725, the low of August 31 and resistance at 0.9869, Friday’s high.
The Commerce Department said gross domestic product in the U.S. expanded at a rate of 2.2% in the three months to March, below expectations for a 2.5% increase.
Earlier in the week, Fed Chairman Ben Bernanke left open the possibility of further measures to bolster economic growth after the central bank’s monetary policy meeting, saying policymakers were “prepared to do more” if necessary.
The Canadian dollar was boosted by expectations for an interest rate hike by the Bank of Canada in the coming months, after the central bank indicated earlier this month that the rate of inflation is rising more rapidly than previously expected.
In a speech on Friday, BoC Governor Mark Carney reiterated the central bank’s forecast for economic growth of 2.4% this year.
The Canadian dollar was also supported by higher oil prices. Crude futures for delivery in June settled at USD104.78 a barrel on the New York Mercantile Exchange by close of trade on Friday, gaining 0.86% over the week.
Raw materials, including oil account for about half of Canada’s export revenue.
Overall market sentiment was boosted on Friday as a well received auction of Italian government debt eased investor concerns over the euro zone, following a two-notch downgrade of Spain by ratings agency Standard & Poor’s.
S&P cut Spain’s long-term credit rating to BBB+ from A and gave it a negative outlook on Thursday, saying that the recession will undermine government efforts to reduce one of the largest budget deficits in the single currency bloc.
In the week ahead, Friday’s data on U.S. non-farm payrolls will be eagerly anticipated amid concerns that the economic recovery in the U.S. is losing momentum.
Canada is to publish official data on monthly economic growth, while BoC Governor Mark Carney is to speak in Toronto.
Ahead of the coming week, Investing.com has compiled a list of these and other significant events likely to affect the markets.
Monday, April 30
Canada is to release official data on monthly GDP growth, the broadest measure of economic activity and the primary gauge of the economy’s health. The country is also to release government data on raw material price inflation, a leading indicator of consumer inflation.
The U.S. is to publish official data on core personal consumption expenditures price inflation and on personal spending, followed by a report on business activity in Chicago.
Tuesday, May 1
BoC Governor Mark Carney is to speak in Toronto; his comments will be closely watched for any clues on the future possible direction of monetary policy.
In the U.S., the Institute for Supply Management is to release a closely watched report on manufacturing activity, a leading indicator of economic health.
Wednesday, May 2
The U.S. is to produce a report on non-farm employment change, a leading indicator of economic health, followed by government data on factory orders and crude oil stockpiles. This data can be a big market mover for the Canadian dollar due to the size of the country’s energy sector.
Thursday, May 3
The U.S. is to produce government data on unemployment claims, as well as preliminary data on nonfarm productivity and unit labor costs, an important signal of consumer inflation. The country is also to publish an ISM report on service sector growth.
Friday, May 4
In Canada, the Ivey School of Business is to publish its index of business activity.
The U.S. is to round up the week by publishing its closely watched government data on non-farm employment change and the unemployment rate, as well as a report on average hourly earnings.
USD/CAD hit 0.9978 on Monday, the weekly high; the pair subsequently consolidated at 0.9802 by close of trade on Friday, tumbling 1.13% over the week.
The pair is likely to find support at 0.9725, the low of August 31 and resistance at 0.9869, Friday’s high.
The Commerce Department said gross domestic product in the U.S. expanded at a rate of 2.2% in the three months to March, below expectations for a 2.5% increase.
Earlier in the week, Fed Chairman Ben Bernanke left open the possibility of further measures to bolster economic growth after the central bank’s monetary policy meeting, saying policymakers were “prepared to do more” if necessary.
The Canadian dollar was boosted by expectations for an interest rate hike by the Bank of Canada in the coming months, after the central bank indicated earlier this month that the rate of inflation is rising more rapidly than previously expected.
In a speech on Friday, BoC Governor Mark Carney reiterated the central bank’s forecast for economic growth of 2.4% this year.
The Canadian dollar was also supported by higher oil prices. Crude futures for delivery in June settled at USD104.78 a barrel on the New York Mercantile Exchange by close of trade on Friday, gaining 0.86% over the week.
Raw materials, including oil account for about half of Canada’s export revenue.
Overall market sentiment was boosted on Friday as a well received auction of Italian government debt eased investor concerns over the euro zone, following a two-notch downgrade of Spain by ratings agency Standard & Poor’s.
S&P cut Spain’s long-term credit rating to BBB+ from A and gave it a negative outlook on Thursday, saying that the recession will undermine government efforts to reduce one of the largest budget deficits in the single currency bloc.
In the week ahead, Friday’s data on U.S. non-farm payrolls will be eagerly anticipated amid concerns that the economic recovery in the U.S. is losing momentum.
Canada is to publish official data on monthly economic growth, while BoC Governor Mark Carney is to speak in Toronto.
Ahead of the coming week, Investing.com has compiled a list of these and other significant events likely to affect the markets.
Monday, April 30
Canada is to release official data on monthly GDP growth, the broadest measure of economic activity and the primary gauge of the economy’s health. The country is also to release government data on raw material price inflation, a leading indicator of consumer inflation.
The U.S. is to publish official data on core personal consumption expenditures price inflation and on personal spending, followed by a report on business activity in Chicago.
Tuesday, May 1
BoC Governor Mark Carney is to speak in Toronto; his comments will be closely watched for any clues on the future possible direction of monetary policy.
In the U.S., the Institute for Supply Management is to release a closely watched report on manufacturing activity, a leading indicator of economic health.
Wednesday, May 2
The U.S. is to produce a report on non-farm employment change, a leading indicator of economic health, followed by government data on factory orders and crude oil stockpiles. This data can be a big market mover for the Canadian dollar due to the size of the country’s energy sector.
Thursday, May 3
The U.S. is to produce government data on unemployment claims, as well as preliminary data on nonfarm productivity and unit labor costs, an important signal of consumer inflation. The country is also to publish an ISM report on service sector growth.
Friday, May 4
In Canada, the Ivey School of Business is to publish its index of business activity.
The U.S. is to round up the week by publishing its closely watched government data on non-farm employment change and the unemployment rate, as well as a report on average hourly earnings.