US dollar gained ground against its Canadian counterpart, reaching its highest point during Wednesday trade, following a report to show building permits in Canada plummeting for the first time in six months during June.
USD/CAD hit a session high at 1.0443 at 13:05 GMT, the highest since July 11th, after which consolidation followed at 1.0427. Support was likely to be found at current session low, 1.0366, while resistance was to be encountered at July 11th high, 1.0470.
Statistics Canada said earlier today that building permits fell for the first time in six months in June, almost four times more than initially expected. The total value of permits in Canada dropped by 10.3% to 6.65 billion CAD, due to failed residential projects in Ontario and non-residential projects in Quebec. Analysts had projected a drop by 2.8%. Multi-family house permits decreased by 18.8%, while permits for single-family houses dropped by 7.4%. On the other hand, permits for non-residential buildings dropped by 6.1% to a total value of 2.68 billion CAD.
In addition, the seasonally adjusted value of the Ivey PMI in Canada declined to 48.4 in July, marking its first entrance in the zone of contraction in eight months, as values below the 50.0 level are a signal for diminished purchasing activity among managers. In June the indicator stood at 55.3, while expectations pointed an advance to a reading of 56.0.
Meanwhile, the greenback was under pressure, as recent economic data from the United States fueled the uncertainty over the future of Federal Reserve’s monthly asset purchases. Chicago Federal Reserve Bank Chairman Charles Evans said that he would not rule out the withdrawal of central bank’s stimulus measures at the bank’s meeting in September. This way he echoed the remarks made by Dennis Lockhart, the president of the Federal Reserve for Atlanta on Tuesday.
Elsewhere, Canadian dollar was trading lower against the euro, as EUR/CAD advanced 0.60% to 1.3892 at 14:37 GMT. Additionally, GBP/CAD cross jumped by 1.48% today, trading at 1.6165 at 14:38 GMT.
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