USD/CAD climbs to daily highs above 1.3100 ahead of mid-tier data
- USD/CAD is pushing higher above 1.3100 on Thursday.
- WTI trades in the negative territory near $41.
- US Dollar Index rebounds above 92.50 as sentiment sours.
After dropping to a weekly low of 1.3032 on Wednesday, the USD/CAD pair turned north on Thursday as falling crude oil prices make it difficult for the commodity-sensitive loonie to find demand. As of writing, the pair was up 0.25% on a daily basis at 1.3114.
WTI fails to hold above $42
Heightened optimism for a steady recovery in global energy demand amid positive coronavirus vaccine developments and hopes for additional oil output cuts provided a boost to crude oil prices during the first half of the week. However, the barrel of West Texas Intermediate (WTI), which climbed to $42.50 area on Wednesday, seems to have gone into a consolidation phase and was last seen losing nearly 1% on the day at $41.15.
Meanwhile, the souring market mood, as reflected by sharp declines witnessed in major European equity indexes, is helping the greenback gather strength against its rivals. At the moment, the US Dollar Index is up nearly 0.4% on the day at 92.66.
Later in the day, the US Department of Labor's weekly Initial Jobless Claims data and the Federal Reserve Bank of Philadelphia's Manufacturing Survey will be looked upon for fresh impetus. On the other hand, ADP Employment Change will be featured in the Canadian economic docket.
Investors will keep a close eye on Wall Street as well. The S&P 500 Futures are currently down 0.3% on the day and the USD could preserve its bullish momentum in the second half of the day if US stocks suffer heavy losses.
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.
