USD/CAD slid on downbeat US initial jobless claims

The broadly retreating US dollar lost ground against its Canadian counterpart as well on trading Thursday, after the disappointing weekly report on initial jobless claims from the United States dampened optimism that the Federal Reserve will begin tapering its asset purchases, as this reflected upon greenbacks demand.

USD/CAD slid to a session low at 1.0274 at 12:46 GMT, after which consolidation followed at 1.0301. Support was likely to be found at May 20th low, 1.0217, while resistance was to be encountered at July 23rd high, 1.0350.

Today the Labor Department of the United States reported that initial jobless claims rose by 7 000 to reach 343 000 during the week ended on July 20th 2013. Results during the preceding week were revised up to 336 000 from 334 000 previously. Initial estimates pointed that the number of claims will reach 340 000.

Additionally, earlier on Thursday it became clear that durable goods orders in the United States rose by 4.2% in June in comparison with preliminary estimates of a 1.3% rise, while in May the value of the indicator was revised up to an increase by 5.2% from a 3.6% rise previously.

In the mean time, Canadian dollar was additionally boosted due to a speculation of better prospects for the Canadian economy as the discount on Canadian heavy oil compared with the US benchmark narrowed from its widest point in more than two months, Bloomberg reported. Crude oil, the countrys largest export, remained little changed, trading above $100 a barrel for the 16th consecutive day in New York. Average weekly gains picked up the pace during May, rising by 2.5% compared with a 2.2% climb during the previous month, according to a report by Statistics Canada. “If you look at the energy sector, which is a more important one for Canada, prices there are holding firm, if not doing relatively well,” said David Watt, chief economist in Toronto at the Canadian unit of HSBC Holdings Plc, cited by Bloomberg. “The market got a bit ahead of itself in pricing in Canadian dollar weakness.”, he also added.

Elsewhere, the loonie, as Canadian dollar is also known, traded higher against the euro, as EUR/CAD pair dipped by 0.03% to 1.3614 at 14:31 GMT. In the mean time, Canadian currency advanced against the sterling as well, with GBP/CAD cross dropping by 0.23% to 1.5762 at 14:32 GMT.