After four straight sessions of gains, the USD/CAD is consolidating on Friday.
The US currency is strong at 92.45 cents per dollar, despite falling US Treasury yields.
On the back of BOC confidence, the Canadian dollar holds its position, while important data is scrutinized.
The USD/CAD pair consolidated gains in the Asian trading session on Friday, reaching a multi-month high at 1.2550, after making significant gains in the previous four trading days.
The USD/CAD currency pair is currently trading at 1.2541, up 0.06 percent on the day.
The US Dollar Index (DXY), which measures the performance of the greenback against six major currencies, has remained stable at 92.40. The greenback’s gains are limited due to poor economic data and a lack of enthusiasm for the US reflation trade.
The number of people filing for unemployment benefits increased to 379,000, exceeding market predictions of 350,000. The reading pointed to a slower recovery in the labor market in the United States.
Meanwhile, increased coronavirus worries around the world have heightened concerns about the economy’s speed of recovery. As a result, the greenback became more appealing.
On the other side, the Canadian dollar is holding its ground as economic data improves.
Furthermore, oil prices, one of Canada’s key exports, have fallen for the fourth straight session as a result of the failure of OPEC meetings to reach a new output agreement.
Meanwhile, economists polled by Reuters expect the Bank of Canada (BOC) to cut its asset purchases again at its July 14 meeting, citing strong growth expectations. On the reports, the loonie remained unmoved.
On the time being, traders are waiting for the June Canadian Employment and Participation Rate data to provide new trading momentum./n
