The U.S. dollar edged lower against its Canadian counterpart on Thursday, despite the release of strong U.S. economic reports, as a jump in oil prices boosted demand for the commodity-related Canadian currency.
USD/CAD hit 1.3305 during early U.S. trade, the pair’s lowest since March 21; the pair subsequently consolidated at 1.3306, down 0.17%.
The pair was likely to find support at 1.3262, the low of March 21 and resistance at 1.3401, Wednesday’s high.
The dollar was supported after official data showed that the third estimate of fourth quarter gross domestic product was at 2.1%, up from the previous reading of a 1.9% expansion. Analysts had expected a growth rate of 2.0%.
Separately, the U.S. Department of Labor said initial jobless claims declined by 3,000 to 258,000 in the week ending March 25 from the previous week’s total of 261,000. Analysts expected jobless claims to fall by 13,000 to 248,000 last week.
But the Canadian dollar was also supported as oil prices rose sharply on Thursday, helped by ongoing supply disruptions in Libya.
The loonie was also higher against the euro, with EUR/CAD declining 0.53% to 1.4269.