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Forex - USD/CAD little changed ahead of U.S. data

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Shutterstock photo - The U.S. dollar was almost unchanged against the Canadian dollar ahead of the release of U.S. manufacturing data later Monday, as speculation over when the Federal Reserve may begin to taper its asset purchase program continued.

USD/CAD hit 1.0534 during early U.S. trade, the session high; the pair subsequently consolidated at 1.0519, inching up 0.01%.

The pair was likely to find support at 1.0452, the low of June 28 and resistance at 1.0552, Friday's high.

Investors were looking ahead to the Institute of Supply Management's report on U.S. manufacturing activity later in the trading day amid expectations that the Fed will soon start tapering its USD85 billion-a-month bond buying program.

Investors were also awaiting Friday's U.S. nonfarm payrolls data, for further clues on when the U.S. central bank may decide to unwind its stimulus program.

Sentiment on the Canadian dollar remained fragile after official data on Friday showed that the rate of Canadian economic growth slowed in April.

Statistics Canada said gross domestic product expanded by 0.1%, following growth of 0.2% in March, but slightly better than the flat reading forecast by economists.

The loonie, as the Canadian dollar is also known, was lower against the euro, with EUR/CAD rising 0.20% to 1.3712.

The euro was boosted after data indicated that the slump in the euro zone's manufacturing sector is easing.

Spain's manufacturing purchasing managers' index rose to 50.0 in June, the highest level in two years, up from 48.1 in May.

France's manufacturing PMI improved to 48.4 from 46.4 in May, but Germany's manufacturing PMI fell to 48.6, from May's reading of 49.4.

Meanwhile, official data showed that the euro zone unemployment rate ticked up to 12.1% in May from 12% in April, compared to expectations for a reading of 12.3%.

Another report showed that consumer price inflation in the euro zone rose 1.6% in June from 1.4% in May, in line with expectations. - offers an extensive set of professional tools for the Forex, Commodities, Futures and the Stock Market including real-time data streaming, a comprehensive economic calendar, as well as financial news and technical & fundamental analysis by in-house experts.

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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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