- CAD finds demand as WTI gains more than 7% on Thursday.
- US Dollar Index stays above 100 to keep USD/CAD’s losses limited.
- Weekly Jobless Claims and Unit Labor Costs data from US will be watched closely.
The USD/CAD pair rose to its highest level since April 23rd at 1.4163 on Thursday but reversed its direction as recovering crude oil prices helped the commodity-sensitive CAD find demand. As of writing, the pair was trading at 1.4082, down 0.43% on a daily basis.
WTI turns north following Wednesday’s slump
After dropping to $24.50 on Thursday, the barrel of West Texas Intermediate (WTI) recovered modestly after the weekly EIA data showed a smaller-than-expected build in US crude oil stocks. Although the WTI closed the day deep in the negative territory despite a late rebound, it preserved its momentum and was last seen gaining 7.5% on the day at $27.40.
On the other hand, the upbeat market mood as reflected by the strong performance of major European equity indexes makes it tough for the greenback to continue to gather strength against its major rivals. Nevertheless, the US Dollar Index, which posted gains in the last three days, is staying in a consolidation phase above the 100 handle, keeping the pair’s losses limited for the time being.
In the second half of the day, the US Department of Labor’s weekly Initial Jobless Claims data will be looked upon for fresh impetus. Unit Labor Costs and Nonfarm Productivity data for the first quarter will be featured in the US economic docket as well. Moreover, investors will be paying close attention to the Ivery Purchasing Managers Index from Canada for fresh clues on the impact of the coronavirus outbreak on the economic activity.
Technical levels to watch for