Investing.com - The U.S. dollar gained ground against the Canadian dollar on Friday after St. Louis Federal Reserve President James Bullard indicated that the bank could start to taper its stimulus program in October.
USD/CAD settled at 1.0304 on Friday, 0.40% higher for the day, after falling as low as 1.0181 on Thursday, the lowest since June 19. For the week, the pair ended 0.12% lower.
The pair is likely to find support at 1.0200, Thursday’s low and resistance at 1.0333, the high of September 17.
The greenback found support after James Bullard said the decision not to taper in September was “close” and did not rule out a small reduction in the central bank's bond purchases in October.
The comments came during an interview with Bloomberg television.
The greenback hit three-month lows against the Canadian dollar after the Federal Reserve said Wednesday that it wanted to see more evidence of a sustained economic recovery before it adjusted the scale of its bond buying program.
The decision surprised markets, which had been expecting the Fed to cut its USD85 billion-a-month stimulus program by USD10 billion to USD15 billion.
In a press conference following the Fed statement, Chairman Ben Bernanke reiterated that the plan to taper asset purchases was never a "preset course," and added that the bank's decision was dependent on how the economic recovery continues to progress.
The central bank also said it will keep interest rates on hold at record low levels until the unemployment rate falls to around 6.5%, as long as inflation doesn't accelerate beyond 2.5% a year.
In Canada, data on Friday showed that the annual rate of consumer price inflation ticked down to 1.1% in August, from 1.3% in July, but came in above forecasts for annual inflation of 1%.
In the week ahead, uncertainty over the direction of Federal Reserve policy and the decision over Chairman Ben Bernanke’s eventual successor look likely to weigh on the dollar.
Investors will be closely watching U.S. data on consumer confidence and durable goods orders in an attempt to gauge the strength of the economic recovery.
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, September 24
Canada is to produce official 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 private sector data on house price inflation, as well as a closely watched report on consumer confidence.
Wednesday, September 25
The U.S. is to release data on durable goods orders, a leading indicator of production, in addition to a report on new home sales.
Thursday, September 26
The U.S. is to release the weekly report on initial jobless claims, as well as final data on second quarter growth and private sector data on pending home sales.
Friday, September 27
The U.S. is to round up the week with revised data on consumer sentiment and inflation expectations from the University of Michigan, as well as data on personal income and expenditure.
USD/CAD settled at 1.0304 on Friday, 0.40% higher for the day, after falling as low as 1.0181 on Thursday, the lowest since June 19. For the week, the pair ended 0.12% lower.
The pair is likely to find support at 1.0200, Thursday’s low and resistance at 1.0333, the high of September 17.
The greenback found support after James Bullard said the decision not to taper in September was “close” and did not rule out a small reduction in the central bank's bond purchases in October.
The comments came during an interview with Bloomberg television.
The greenback hit three-month lows against the Canadian dollar after the Federal Reserve said Wednesday that it wanted to see more evidence of a sustained economic recovery before it adjusted the scale of its bond buying program.
The decision surprised markets, which had been expecting the Fed to cut its USD85 billion-a-month stimulus program by USD10 billion to USD15 billion.
In a press conference following the Fed statement, Chairman Ben Bernanke reiterated that the plan to taper asset purchases was never a "preset course," and added that the bank's decision was dependent on how the economic recovery continues to progress.
The central bank also said it will keep interest rates on hold at record low levels until the unemployment rate falls to around 6.5%, as long as inflation doesn't accelerate beyond 2.5% a year.
In Canada, data on Friday showed that the annual rate of consumer price inflation ticked down to 1.1% in August, from 1.3% in July, but came in above forecasts for annual inflation of 1%.
In the week ahead, uncertainty over the direction of Federal Reserve policy and the decision over Chairman Ben Bernanke’s eventual successor look likely to weigh on the dollar.
Investors will be closely watching U.S. data on consumer confidence and durable goods orders in an attempt to gauge the strength of the economic recovery.
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, September 24
Canada is to produce official 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 private sector data on house price inflation, as well as a closely watched report on consumer confidence.
Wednesday, September 25
The U.S. is to release data on durable goods orders, a leading indicator of production, in addition to a report on new home sales.
Thursday, September 26
The U.S. is to release the weekly report on initial jobless claims, as well as final data on second quarter growth and private sector data on pending home sales.
Friday, September 27
The U.S. is to round up the week with revised data on consumer sentiment and inflation expectations from the University of Michigan, as well as data on personal income and expenditure.