Greenback gains ground vs. loonie, U.S. data supports

The U.S. dollar climbed against its Canadian counterpart on Thursday, as the release of strong U.S. data added to expectations for a June rate hike by the Federal Reserve.

USD/CAD hit 1.3770 during early U.S. trade, the pair’s highest since May 5; the pair subsequently consolidated at 1.3731, advancing 0.56%.

The pair was likely to find support at 1.3680, Wednesday’s low and resistance at 1.3795, the high of May 5.

The U.S. Department of Labor said initial jobless claims in the week ending May 6 decreased by 2,000 to 236,000 from the previous week’s total of 245,000. Analysts had expected jobless claims to rise by 7,000 to 245,000 last week.

Separately, the Commerce Department said producer prices increased by 0.5% last month, exceeding forecasts for a 0.2% rise. Year-over-year, producer prices rose 2.5% in April.

Core producer prices, which exclude food and energy, advanced by 0.4% in April, higher than forecasts for a gain of 0.2%.

The upbeat data added to expectations for a rate hike by the Federal Reserve next month.

In Canada, data showed that the new housing price index rose 0.2% in March, in line with expectations and after an increase of 0.4% the previous month. 

 

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