Greenback steady at three-week lows vs loonie; Data on tap

Greenback steady at three-week lows vs loonie; Data on tap

28 April 2015, 15:48
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On Tuesday the U.S. dollar was steady at three-week lows against its Canadian counterpart, as the US currency weakened ahead of a report on U.S. consumer confidence due later in the day.

Market players also expect Wednesday's Fed policy statement.

USD/CAD hit 1.2050 during early U.S. trade, the pair's lowest since January 20; the pair subsequently consolidated at 1.2090. The pair was likely to find support at 1.1931, the low of January 20 and resistance at 1.2195, Monday's high.

Traders awaited the S&P/Case Shiller housing index and a report on U.S. consumer confidence due later in the day for further indications on the strength of the recovery, ahead of Wednesday’s Federal Reserve policy announcement.

Recent downbeat data on employment, home sales and industrial production have prompted investors to scale back expectations on the timing of a first rate hike by the U.S. central bank, sending the dollar lower.

In the meantime, Bank of Canada Governor Stephen Poloz said he expects a strong recovery in the second half of this year, as strong U.S. demand in non-energy exports and a lower Canadian dollar boosted the local economy.

In the remarks were part of the BoC governor's opening statement to a committee of lawmakers in the Canadian parliament's lower house, he also indicated that the country's economy posted no growth in the first quarter.

The loonie was lower against the euro, with EUR/CAD rising 0.33% to 1.3207.

The common currency was firmer after Greek Prime Minister Alexis Tsipras reshuffled the team handling talks with the country’s international lenders, removing Yanis Varoufakis as the coordinator. The news spurred optimism that a deal will be reached by early May.

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