- USD/CAD recovers its losses on improved US Dollar.
- The improvement in WTI price could contribute to support for the Canadian Dollar.
- Improved US bond yields steer the Greenback on an upward pathway.
USD/CAD retraces its recent losses registered in the previous session, trading higher near 1.3360 during the European session on Friday. The US Dollar (USD) seems to have recovered its recent losses, hovering near 102.50 on the back of improved US Treasury yields, coupled with the upbeat labor data released on Thursday from the United States (US) However, the improved Crude oil prices could provide support to the Canadian Dollar (CAD).
The 2-year and 10-year yields on US bond coupons stand at 4.39% and 4.00%, respectively, by the press time. Moreover, the positive employment data unveiled on Thursday provided support to limit the downward trajectory of the Greenback. In December, the US ADP Employment Change experienced a substantial surge, adding 164K new positions, surpassing the market expectation of 115K. Initial Jobless Claims for the week ending on December 29, were reduced to 202K from the 220K prior.
The Loonie Dollar (CAD) cheers the improvement in the Crude oil prices. The West Texas Intermediate (WTI) price retraces its recent losses, trading higher around $72.70 per barrel at the time of writing. However, WTI received a downward pressure due to a surge in US gasoline and distillate inventories, raising concerns about the stability of demand.
Canada is gearing up to release the Unemployment Rate and Net Change in Employment numbers for December on Friday. Meanwhile, in the United States, all eyes are on the Average Hourly Earnings and Nonfarm Payrolls (NFP) data. These releases are likely to have a significant impact on market sentiments and provide insights into the labor market dynamics in both countries.
Source: https://www.fxstreet.com/news/usd-cad-surpasses-13350-as-us-treasury-yields-improve-canada-us-labor-data-eyed-202401050452