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Forex - USD/CAD rises amid caution ahead of Fed meeting

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Forex Pros - The Canadian dollar was down against its U.S. counterpart on Wednesday, as investors remained cautious ahead of the Federal Reserve's interest rate announcement and press conference later in the day.

USD/CAD hit 0.9754 during early U.S. trade, a daily high; the pair subsequently consolidated at 0.9742, climbing 0.31%.

The pair was likely to find support at 0.9669, the low of June 15 and a two-week low and resistance at 0.9804, Tuesday's high.

Markets turned their attention to the Federal Reserve's policy setting meeting, which was to be followed with a press conference by Fed Chairman Ben Bernanke later in the day.

Mr. Bernanke was widely expected to reaffirm the bank's pledge to hold interest rates near zero for an extended period, while investors will watch for clues regarding the current round of quantitative easing, which was due to end on June 30.

Meanwhile, risk sentiment was dented as market focus turned from Tuesday's parliamentary confidence-vote win by Greece's government to next week's vote on harsh austerity measures.

Greece's parliament backed Prime Minister George Papandreou's new cabinet on Tuesday, wining the support of 155 out of 300 parliament members.

However, markets remained wary as Greek lawmakers still needed to support next week's vote on new austerity measures, which include harsh spending cuts and new taxes over the next five years.

The Canadian dollar was also down against the euro, with EUR/CAD rising 0.19% to hit 1.4022.

In addition to the Fed's rate statement, the U.S. was also to publish industry data on home prices, as well as a report on crude oil inventories.

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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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