Daily Afternoon Report 16.05.2017

The Canadian dollar rose to the highest levels in three weeks against its broadly weaker U.S. counterpart on Tuesday as fresh concerns over the Trump administration and a slate of mixed U.S. economic reports pressured the greenback.

The greenback weakened across the board following reports that U.S. President Donald Trump shared sensitive intelligence obtained from a close U.S. ally with Russia’s foreign minister about an Islamic State operation in a meeting last week.

The report came as Trump’s administration reels over his decision to sack former FBI Director James Comey and amid congressional calls for an independent investigation of possible Russian interference with the U.S. election.

The report underlined doubts over Trump’s ability to successfully push through his economic stimulus program.

The dollar came under additional selling pressure after data showing that U.S. housing starts slowed unexpectedly in April pointed to a slowdown the housing market recovery.

Housing starts fell by 2.6% to a seasonally adjusted annual rate of 1.17 million units, the Commerce Department said. It was the lowest since November and added to a recent run of disappointing U.S. economic data. Building permits fell by 2.5% the report said.

Another report showed that U.S. industrial production rose 1.0% in April, well above expectations for a 0.4% increase.

The loonie remained supported as prices of oil, a major Canadian export, rose on Tuesday amid hopes for an extension of a supply cut deal aimed at reducing a global supply glut.

The U.S. dollar index, which measures the greenback’s strength against a trade-weighted basket of six major currencies, was down 0.6% at 98.22, the lowest trough since November 9.