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Forex - USD/CAD almost unchanged after U.S. inflation report

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Investing.com -

Investing.com - The U.S. dollar was almost unchanged against its Canadian counterpart on Wednesday, after the release of downbeat U.S. inflation data as markets awaited the outcome of the Federal Reserve's policy meeting.

USD/CAD hit 1.0949 during early U.S. trade, the pair's lowest since September 11; the pair subsequently consolidated at 1.0963, dipping 0.06%.

The pair was likely to find support at 1.0930, the low of September 11 and resistance at 1.1058, the high of September 11.

In a report, the Labor Department said that the U.S. consumer price index fell 0.2% in August, pulling the annual rate of inflation down to 1.7% from 1.9% in July.

The unexpected slowdown in inflation was due to falling energy prices, the report said. Energy prices fell by 2.4% last month, including a 4.1% drop in gasoline prices.

But the dollar's losses were expected to remain limited by heightened expectations for an early hike in U.S. interest rates ahead of the outcome of the Fed's monetary policy meeting later Wednesday.

The Fed was expected to cut its asset purchase program by another $10 billion after the meeting, which would keep it on track for winding up the program in October.

Fed Chair Janet Yellen was to hold what would be a closely watched press conference following the meeting.

The Canadian dollar had found support on Tuesday after data showed that Canadian manufacturing sales rose to a record high in July.

The loonie was steady against the euro, with EUR/CAD inching 0.06% lower to 1.4211.

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.


The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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