USD/CAD slumps to daily lows below 1.3250 as WTI rebounds to $52 area

• WTI stages modest recovery after weekly EIA report.
• The pair remains in the consolidation channel.
• Coming up: Fed’s Beige Book.

The USD/CAD erased its daily gains and turned negative on the day in the NA session as the commodity-sensitive loonie gathered strength on the back of rising crude oil prices. As of writing, the pair, which touched a session low of 1.3233, was trading at 1.3245, losing 0.18% on a daily basis.

The weekly report published by the EIA today showed that crude oil inventories in the U.S. declined by 2.7 million barrels for the week ending January 11 compared to analysts’ expectation for a draw of  1.5 million barrels and provided a boost to crude oil prices. After falling to the $51.20 area earlier in the day, the barrel of West Texas Intermediate rose above $52 handle before losing its traction. At the moment, the WTI is losing 20 cents on the day at $51.75.

Meanwhile, today’s data from the U.S. showed that import prices fell 1% on a monthly basis in December and the NAHB’s Builder Confidence Index improved to 58 in January from 56 in December. Nevertheless, markets largely ignored these data and the US Dollar Index stayed in the upper half of its daily range above the 96 handle to limit the pair’s losses. At 19 GMT, the Fed will publish its Beige Book and investors will be looking for signs of an economic slowdown in the U.S.

Key technical levels