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Forex - USD/CAD hits 3-month high as crude oil prices tumble

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Forexpros - The U.S. dollar surged to a three-month high against its Canadian counterpart in choppy trade on Monday, as crude oil, Canada's largest export tumbled amid widespread risk aversion.

USD/CAD hit 0.9913 during early U.S. trade, the pair's highest since March 17; the pair subsequently consolidated at 0.9885, rising 0.07%.

The pair was likely to find support at 0.9769, Friday's low and resistance at 0.9966, the high of March 16.

Concerns that the euro zone's debt crisis will deepen if Greece rejects a new austerity package in a critical vote on Wednesday sparked a flight to safety, bolstering the greenback.

Earlier in the day, the U.S. Commerce Department said personal spending was unexpectedly flat in May, disappointing expectations for a 0.1% gain. The previous month's figure was revised down to 0.3% from 0.4%.

It was the weakest reading since June 2010, as higher gasoline prices and a weak labor market curbed consumer spending.

Personal income rose 0.3%, broadly in line with expectations, while the core personal consumption expenditure index rose 0.3% in May, the largest gain since October 2009.

Crude oil for delivery in August was sharply lower on the New York Mercantile Exchange, tumbling 1.01% to trade at USD90.36 a barrel.

Raw materials, including oil account for about half of Canada's export revenue.

The Canadian dollar was also lower against the euro, with EUR/CAD easing up 0.22% to hit 1.4058.

Later in the week, Canada was to publish official data on consumer price inflation for May and gross domestic product for April.

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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.

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