USD/CAD advances beyond 1.2700 as USD continues to gather strength
- USD/CAD preserves its bullish momentum in early American session.
- US Dollar Index continues to push higher toward 93.50.
- Investors wait for FOMC Chairman Jerome Powell's speech at 1400 GMT.
Following Thursday's sharp decline, the USD/CAD pair started the last day of the week on a firm footing and extended its daily advance to a fresh daily high of 1.2731 in the early American session. As of writing, the pair was up 0.55% on a daily basis at 1.2725.
USD capitalizes on safe-haven flows
The broad-based USD strength is fueling USD/CAD's rally on Friday. With safe-haven flows providing a boost to the greenback, the US Dollar Index (DXY) is currently rising 0.32% at 93.38. In the meantime, Wall Street's main indexes remain on track to open deep in the negative territory with the US stock index futures losing between 0.5% and 0.8%.
Moreover, Cleveland Federal Reserve Bank President Loretta Mester said on Friday that she is in favour of start reducing asset purchases in November and ending in the first half of 2022, helping DXY push higher.
Later in the session, FOMC Chairman Jerome Powell will deliver his opening remarks at the Fed Listens event. Fed Governor Michelle Bowman and Vice Chair Richard Clarida will also be appearing at the same event. Additionally, August New Home Sales data will be looked upon for fresh impetus.
On the other hand, the barrel of West Texas Intermediate is posting small daily losses near $73.00, making it difficult for the commodity-related loonie to show resilience against its American counterpart.
Technical levels to watch for
Author
Eren Sengezer
FXStreet
As an economist at heart, Eren Sengezer specializes in the assessment of the short-term and long-term impacts of macroeconomic data, central bank policies and political developments on financial assets.
