Investing.com - The U.S. dollar tumbled to a three-week low against its Canadian counterpart on Friday, before trimming some of the week’s losses amid fears over the euro zone’s debt crisis ahead of a key economic summit next week.
CAD/USD hit 1.0079 on Friday, the pair’s lowest since November 14; the pair subsequently consolidated at 1.0191 by close of trade on Friday, plummeting 2.42% over the week.
The pair is likely to find support at 1.0020, the low of October 24 and resistance at 1.0301, the high of November 18.
The greenback was higher on Friday despite better-than-expected U.S.
unemployment data, as concerns over the euro zone financial crisis supported safe haven demand.
The U.S. Department of Labor said the unemployment rate dropped unexpectedly to a two-and-a-half year low of 8.6% in November, as the U.S. economy created 120,000 new jobs.
But skepticism over whether the euro zone’s bailout fund, the European Financial Stability Facility, can contain the region’s debt crisis and speculation over a potential downgrade of Spain supported the greenback.
Also Friday, official data showed that Canada’s unemployment rate rose unexpectedly in November, ticking up to 7.4% after a reading at 7.3% the previous month.
Official data showed on Thursday that Canada’s economy expanded broadly in line with market expectations in September, with gross domestic product increasing by a seasonally adjusted 0.2%, bringing the annualized rate of growth to 3%, outstripping expectations for a 2.7% year-on-year increase.
The U.S. dollar tumbled 1.38% against the loonie on Wednesday after six major central banks including the Federal Reserve and the Bank of Canada said they had agreed to lower dollar swap rates to prevent a lack of liquidity in the global financial system.
The announcement came after China said that it plans to cut bank’s reserve requirement ratios in an effort to help boost liquidity and support the world’s second largest economy amid global market turmoil.
The loonie also found support as light sweet crude futures for delivery in January traded at USD101.11 a barrel by close of trade on Friday, jumping 3.43% over the week.
Raw materials, including oil account for about half of Canada’s export revenue.
In the week ahead, investors will be closely watching the ECB’s policy meeting on Thursday, amid expectations for a 0.5% rate cut by the bank. Meanwhile, EU leaders are to hold a summit meeting to address the region’s crisis on Friday.
Ahead of the coming week, Investing.com has compiled a list of these and other significant events likely to affect the markets.
Monday, December 5
In the U.S., the Institute of Supply Management is to release a report on service sector activity, a leading indicator of economic health. The U.S. is also to publish government data on factory orders, a leading indicator of production.
Tuesday, December 6
The Bank of Canada is to announce its benchmark interest rate. Canada is also to release official data on building permits, an excellent gauge of future construction activity, as well as the Ivey PMI, a leading indicator of economic health.
Wednesday, December 7
The U.S. is to release government data on crude oil stockpiles. The data can be a big market mover for the loonie due to the size of Canada's energy sector.
Thursday, December 8
Canada is to publish official data on housing starts, as well as data on house price inflation, both leading indicators of economic health.
Also Thursday, the U.S. is to publish its weekly report on initial jobless claims, the nation’s earliest economic data.
Friday, December 9
Canada is also to release data on its trade balance as well as data on labor productivity, a leading indicator of inflation.
The U.S. is to round up the week with data on the trade balance, while the University of Michigan is to release preliminary data on consumer sentiment and inflation expectations, leading indicators of economic health.
CAD/USD hit 1.0079 on Friday, the pair’s lowest since November 14; the pair subsequently consolidated at 1.0191 by close of trade on Friday, plummeting 2.42% over the week.
The pair is likely to find support at 1.0020, the low of October 24 and resistance at 1.0301, the high of November 18.
The greenback was higher on Friday despite better-than-expected U.S.
unemployment data, as concerns over the euro zone financial crisis supported safe haven demand.
The U.S. Department of Labor said the unemployment rate dropped unexpectedly to a two-and-a-half year low of 8.6% in November, as the U.S. economy created 120,000 new jobs.
But skepticism over whether the euro zone’s bailout fund, the European Financial Stability Facility, can contain the region’s debt crisis and speculation over a potential downgrade of Spain supported the greenback.
Also Friday, official data showed that Canada’s unemployment rate rose unexpectedly in November, ticking up to 7.4% after a reading at 7.3% the previous month.
Official data showed on Thursday that Canada’s economy expanded broadly in line with market expectations in September, with gross domestic product increasing by a seasonally adjusted 0.2%, bringing the annualized rate of growth to 3%, outstripping expectations for a 2.7% year-on-year increase.
The U.S. dollar tumbled 1.38% against the loonie on Wednesday after six major central banks including the Federal Reserve and the Bank of Canada said they had agreed to lower dollar swap rates to prevent a lack of liquidity in the global financial system.
The announcement came after China said that it plans to cut bank’s reserve requirement ratios in an effort to help boost liquidity and support the world’s second largest economy amid global market turmoil.
The loonie also found support as light sweet crude futures for delivery in January traded at USD101.11 a barrel by close of trade on Friday, jumping 3.43% over the week.
Raw materials, including oil account for about half of Canada’s export revenue.
In the week ahead, investors will be closely watching the ECB’s policy meeting on Thursday, amid expectations for a 0.5% rate cut by the bank. Meanwhile, EU leaders are to hold a summit meeting to address the region’s crisis on Friday.
Ahead of the coming week, Investing.com has compiled a list of these and other significant events likely to affect the markets.
Monday, December 5
In the U.S., the Institute of Supply Management is to release a report on service sector activity, a leading indicator of economic health. The U.S. is also to publish government data on factory orders, a leading indicator of production.
Tuesday, December 6
The Bank of Canada is to announce its benchmark interest rate. Canada is also to release official data on building permits, an excellent gauge of future construction activity, as well as the Ivey PMI, a leading indicator of economic health.
Wednesday, December 7
The U.S. is to release government data on crude oil stockpiles. The data can be a big market mover for the loonie due to the size of Canada's energy sector.
Thursday, December 8
Canada is to publish official data on housing starts, as well as data on house price inflation, both leading indicators of economic health.
Also Thursday, the U.S. is to publish its weekly report on initial jobless claims, the nation’s earliest economic data.
Friday, December 9
Canada is also to release data on its trade balance as well as data on labor productivity, a leading indicator of inflation.
The U.S. is to round up the week with data on the trade balance, while the University of Michigan is to release preliminary data on consumer sentiment and inflation expectations, leading indicators of economic health.