Investing.com - The U.S. dollar was fractionally higher against its Canadian counterpart on Friday, paring some of the week’s losses but the loonie remained supported amid hopes of progress in Greek debt talks.
USD/CAD hit 0.9937 on Wednesday, the pair’s lowest February 9; the pair subsequently consolidated at 0.9966, shedding 0.41% over the week.
The pair is likely to find support at 0.9924, the low of February 9 and resistance at 1.0014, the high of February 13.
Sentiment was lifted on Friday after German Chancellor Angela Merkel and Greek Prime Minister Lucas Papademos expressed optimism that an agreement would be reached at Monday's meeting of euro zone finance ministers.
However, investors remained cautious as European officials warned that that there was still a long way to go in order for Greece to meet the target for its debt burden which would allow the EUR130 billion bailout to proceed.
Without a bailout, Greece faces the threat of defaulting when a EUR14.5 billion bond redemption comes due on March 20.
Meanwhile, the greenback was boosted by a flurry of upbeat U.S. economic data. On Thursday, the U.S. Department of Labor said initial jobless claims unexpectedly fell to their lowest level since March 2008 last week, declining to 348,000, confounding expectations for an increase to 364,000.
In a separate report, the U.S. Census Bureau said the number of building permits issued in January rose 0.7% to a seasonally adjusted 0.68 million, broadly in line with market expectations.
Data also showed that an index of manufacturing activity in the Philadelphia area rose more-than-expected in February, advancing to 10.2, above expectations for a rise to 9.0.
In addition, U.S. core producer price inflation rose more-than-expected in January, ticking up 0.4% after a 0.3% rise the previous month. Analysts had expected core PPI to rise 0.1% in January.
On Friday, the U.S. Conference Board said that its index of leading economic indicators increased for the fourth consecutive month in January.
In Canada, official data showed that core consumer price inflation, which excludes the eight most volatile items, rose 0.2% in January, beating expectations for a 0.1% rose, while consumer price inflation rose 0.4%, beating expectations for a 0.3% rise.
Data also showed on Thursday that manufacturing sales in Canada rose 0.6% in December, disappointing expectations for a 1% rise.
A separate report showed that foreign securities purchases fell more-than-expected December, falling to CAD7.38 billion from CAD14.64 billion the previous month. Analysts had expected foreign securities purchases to fall to CAD7.98 billion in December.
The loonie was also supported as light sweet crude futures for delivery in March settled at USD103.91 a barrel by close of trade on Friday on the New York Mercantile Exchange, rallying 4.4% over the week.
Raw materials, including oil account for about half of Canada’s export revenue.
In the week ahead, markets will be keenly awaiting the outcome of Monday’s meeting of euro zone finance ministers, while markets in the U.S. will be closed for the Presidents Day holiday.
Also next week, the euro zone is to produce closely watched preliminary data on manufacturing a service sector activity, while the U.S. is to release a flurry of housing sector data.
Ahead of the coming week, Investing.com has compiled a list of these and other significant events likely to affect the markets.
Monday, February 20
Markets in the U.S. will remain closed for the Presidents Day holiday.
Tuesday, February 21
Canada is to publish official data on retail sales, the foremost indicator of consumer spending, which accounts for the majority of overall economic activity. The country is also to release an official report on wholesale sales, a leading indicator of consumer spending.
Wednesday, February 22
The U.S. is to release industry data on existing home sales, a leading indicator of demand in the housing market, followed by official data on crude oil stockpiles.
Thursday, February 23
The U.S. is to release government data on unemployment claims, an important signal of overall economic health.
Meanwhile, finance ministers and central bankers are to meet throughout the day for the seventh G20 meeting, in Mexico.
Friday, February 24
Bank of Canada Governor Mark Carney is due to speak at the U.S. Monetary Policy Forum, in New York.
The U.S. is to round up the week with a revised report by the University of Michigan on consumer sentiment, followed by government data on new home sales, an important signal of economic health.
USD/CAD hit 0.9937 on Wednesday, the pair’s lowest February 9; the pair subsequently consolidated at 0.9966, shedding 0.41% over the week.
The pair is likely to find support at 0.9924, the low of February 9 and resistance at 1.0014, the high of February 13.
Sentiment was lifted on Friday after German Chancellor Angela Merkel and Greek Prime Minister Lucas Papademos expressed optimism that an agreement would be reached at Monday's meeting of euro zone finance ministers.
However, investors remained cautious as European officials warned that that there was still a long way to go in order for Greece to meet the target for its debt burden which would allow the EUR130 billion bailout to proceed.
Without a bailout, Greece faces the threat of defaulting when a EUR14.5 billion bond redemption comes due on March 20.
Meanwhile, the greenback was boosted by a flurry of upbeat U.S. economic data. On Thursday, the U.S. Department of Labor said initial jobless claims unexpectedly fell to their lowest level since March 2008 last week, declining to 348,000, confounding expectations for an increase to 364,000.
In a separate report, the U.S. Census Bureau said the number of building permits issued in January rose 0.7% to a seasonally adjusted 0.68 million, broadly in line with market expectations.
Data also showed that an index of manufacturing activity in the Philadelphia area rose more-than-expected in February, advancing to 10.2, above expectations for a rise to 9.0.
In addition, U.S. core producer price inflation rose more-than-expected in January, ticking up 0.4% after a 0.3% rise the previous month. Analysts had expected core PPI to rise 0.1% in January.
On Friday, the U.S. Conference Board said that its index of leading economic indicators increased for the fourth consecutive month in January.
In Canada, official data showed that core consumer price inflation, which excludes the eight most volatile items, rose 0.2% in January, beating expectations for a 0.1% rose, while consumer price inflation rose 0.4%, beating expectations for a 0.3% rise.
Data also showed on Thursday that manufacturing sales in Canada rose 0.6% in December, disappointing expectations for a 1% rise.
A separate report showed that foreign securities purchases fell more-than-expected December, falling to CAD7.38 billion from CAD14.64 billion the previous month. Analysts had expected foreign securities purchases to fall to CAD7.98 billion in December.
The loonie was also supported as light sweet crude futures for delivery in March settled at USD103.91 a barrel by close of trade on Friday on the New York Mercantile Exchange, rallying 4.4% over the week.
Raw materials, including oil account for about half of Canada’s export revenue.
In the week ahead, markets will be keenly awaiting the outcome of Monday’s meeting of euro zone finance ministers, while markets in the U.S. will be closed for the Presidents Day holiday.
Also next week, the euro zone is to produce closely watched preliminary data on manufacturing a service sector activity, while the U.S. is to release a flurry of housing sector data.
Ahead of the coming week, Investing.com has compiled a list of these and other significant events likely to affect the markets.
Monday, February 20
Markets in the U.S. will remain closed for the Presidents Day holiday.
Tuesday, February 21
Canada is to publish official data on retail sales, the foremost indicator of consumer spending, which accounts for the majority of overall economic activity. The country is also to release an official report on wholesale sales, a leading indicator of consumer spending.
Wednesday, February 22
The U.S. is to release industry data on existing home sales, a leading indicator of demand in the housing market, followed by official data on crude oil stockpiles.
Thursday, February 23
The U.S. is to release government data on unemployment claims, an important signal of overall economic health.
Meanwhile, finance ministers and central bankers are to meet throughout the day for the seventh G20 meeting, in Mexico.
Friday, February 24
Bank of Canada Governor Mark Carney is due to speak at the U.S. Monetary Policy Forum, in New York.
The U.S. is to round up the week with a revised report by the University of Michigan on consumer sentiment, followed by government data on new home sales, an important signal of economic health.