Investing.com - The U.S. dollar was higher against the Canadian dollar on Friday as unexpectedly weak data on U.S. consumer sentiment bolstered safe haven demand for the greenback.
USD/CAD hit session highs of 1.0360, before settling at 1.0339, 0.32% higher for the day and ending the week with gains of 0.25%.
The pair is likely to find support at 1.0279, the low of August 12 and resistance at 1.0368, the high of August 14.
Safe haven demand for the dollar was boosted on Friday after the University of Michigan said its consumer sentiment index fell from a six-year high of 85.1 in July to 80.0 in August. Economists had expected the index to tick up to 85.5.
Separate reports showed that U.S. housing starts rose less-than-expected in July and building permits also fell short of expectations last month.
The data came amid ongoing speculation over how soon the Federal Reserve will start to phase out its bond buying program. Fed Chairman Ben Bernanke has said that the decision to begin tapering the bank’s USD85 billion-a-month asset purchase program will depend on whether economic data is strong enough.
Expectations that the Fed may begin tapering as soon as September were boosted on Thursday after the Department of Labor said the number of people who filed for unemployment assistance in the U.S. fell to the lowest level since January 2008 last week, dropping by 15,000 to 320,000.
In Canada, official data on Friday showed that manufacturing sales fell 0.5% in June, the fourth decline in six months, confounding expectations for a 1% increase.
A separate report showed that non-resident investors reduced their holdings of Canadian securities by CAD15.4 billion in June, the largest reduction since October 2007.
In the week ahead, investors will be looking ahead to Wednesday’s minutes of the Federal Reserve’s most recent meeting, while U.S. data on initial jobless claims and the housing sector will also be closely watched.
Canadian data on retail sales and consumer inflation will also be in focus.
Ahead of the coming week, Investing.com has compiled a list of these and other significant events likely to affect the markets. The guide skips Monday as there are no relevant events on this day.
Tuesday, August 20
Canada is to publish data on wholesale sales, an important indicator of consumer spending.
Wednesday, August 21
The U.S. is to publish private sector data on existing home sales, a leading indicator of economic health. In addition the Federal Reserve is to publish the minutes of its most recent policy setting meeting.
Thursday, August 22
Canada is to produce data on retail sales, the government measure of consumer spending, which accounts for the majority of overall economic activity.
The U.S. is to release the weekly government report on initial jobless claims.
Friday, August 23
Canada is to publish data on consumer price inflation, which accounts for the majority of overall inflation.
The U.S. is to round up the week with data on new home sales, a leading indicator of economic health.
USD/CAD hit session highs of 1.0360, before settling at 1.0339, 0.32% higher for the day and ending the week with gains of 0.25%.
The pair is likely to find support at 1.0279, the low of August 12 and resistance at 1.0368, the high of August 14.
Safe haven demand for the dollar was boosted on Friday after the University of Michigan said its consumer sentiment index fell from a six-year high of 85.1 in July to 80.0 in August. Economists had expected the index to tick up to 85.5.
Separate reports showed that U.S. housing starts rose less-than-expected in July and building permits also fell short of expectations last month.
The data came amid ongoing speculation over how soon the Federal Reserve will start to phase out its bond buying program. Fed Chairman Ben Bernanke has said that the decision to begin tapering the bank’s USD85 billion-a-month asset purchase program will depend on whether economic data is strong enough.
Expectations that the Fed may begin tapering as soon as September were boosted on Thursday after the Department of Labor said the number of people who filed for unemployment assistance in the U.S. fell to the lowest level since January 2008 last week, dropping by 15,000 to 320,000.
In Canada, official data on Friday showed that manufacturing sales fell 0.5% in June, the fourth decline in six months, confounding expectations for a 1% increase.
A separate report showed that non-resident investors reduced their holdings of Canadian securities by CAD15.4 billion in June, the largest reduction since October 2007.
In the week ahead, investors will be looking ahead to Wednesday’s minutes of the Federal Reserve’s most recent meeting, while U.S. data on initial jobless claims and the housing sector will also be closely watched.
Canadian data on retail sales and consumer inflation will also be in focus.
Ahead of the coming week, Investing.com has compiled a list of these and other significant events likely to affect the markets. The guide skips Monday as there are no relevant events on this day.
Tuesday, August 20
Canada is to publish data on wholesale sales, an important indicator of consumer spending.
Wednesday, August 21
The U.S. is to publish private sector data on existing home sales, a leading indicator of economic health. In addition the Federal Reserve is to publish the minutes of its most recent policy setting meeting.
Thursday, August 22
Canada is to produce data on retail sales, the government measure of consumer spending, which accounts for the majority of overall economic activity.
The U.S. is to release the weekly government report on initial jobless claims.
Friday, August 23
Canada is to publish data on consumer price inflation, which accounts for the majority of overall inflation.
The U.S. is to round up the week with data on new home sales, a leading indicator of economic health.