Forex Pros - The U.S. dollar extended losses against its Canadian counterpart on Tuesday, after reports showing that U.S. producer prices posted a large annualized gain last month, while Canada's industrial capacity increased in the first quarter.
USD/CAD hit 0.9698 during early U.S. trade, the pair's lowest since June 1; the pair subsequently consolidated at 0.9711, shedding 0.47%.
The pair was likely to find support at 0.9666, the low of June 1 and resistance at 0.9797, Monday's high.
Earlier in the day, the U.S. Bureau of Labor Statistics said producer prices rose 0.2% in May, taking the annual inflation rate to 7.3%, more than the 6.8% forecasted increase.
Core inflation, which excludes food and energy costs, rose broadly in line with expectations in May, increasing by 0.2% after rising by 0.3% in the preceding month.
A separate report showed that U.S. retail sales posted the first drop in 11 months in May, dragged down by falling automobile sales.
The Commerce Department said retail sales slipped 0.2%, after a downwardly revised 0.3% increase in April. Analysts had expected retail sales to decline by 0.7% last month.
Meanwhile, Statistics Canada said Canadian industries operated at 79% of their production capacity in the first quarter, up 2.2% from the previous quarter.
It was the seventh consecutive quarterly gain and surpassed expectations for an increase to 77%.
The Canadian dollar was also higher against the euro, with EUR/CAD shedding 0.43% to hit 1.4006.
Also Tuesday, Chinese government data showed that consumer price inflation rose at an annualized rate of 5.5% in May, broadly in line with expectations. Retail sales came in slightly higher than forecast and industrial output was slightly lower, easing investor concerns over a slowdown in the world's second largest economy.