USD/CAD drops to fresh multi-year lows below 1.2200
|- USD/CAD extended its slide after closing the red on Wednesday.
- US Dollar Index looks to close below 91.00.
- Focus shifts to April Nonfarm Payrolls (NFP) report from the US.
The USD/CAD pair stayed relatively calm around 1.2250 during the first half of the day but lost its traction in the American session and touched its lowest level since September 2017 at 1.2179. As of writing, the pair was losing 0.57% on a daily basis at 1.2195.
USD selloff continues ahead of Friday's key data releases
Amid a lack of significant macroeconomic data releases from Canada, the USD's market valuation continued to drive USD/CAD's movements. Additionally, the barrel of West Texas Intermediate (WTI) is moving sideways on Thursday, failing to provide a directional clue to the commodity-related CAD.
Earlier in the day, the data from the US showed that the weekly Initial Jobless Claims declined by 92,000 to 498,000. Although this reading failed to trigger a meaningful market reaction, it helped the market mood remain upbeat. With Wall Street's main indexes rising between 0.3% and 0.45%, the USD remains on the back foot. Currently, the US Dollar Index is down 0.3% on the day at 90.97.
On Friday, April jobs report from both the US and Canada will be watched closely by market participants. Investors expect Nonfarm Payrolls (NFP) in the US to increase by 978,00 and see the Unemployment Rate edging lower to 5.8% from 6%. A stronger-than-expected NFP reading could help the USD find demand ahead of the weekend. On the other hand, analysts' estimate points to a modest increase in the Canadian Unemployment Rate to 7.8% from 7.5%.
Technical levels to watch for
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