USD/CAD extends sideways grind above 1.3200 ahead of US and Canada data

• USD/CAD is consolidating gains above 1.3200 on Thursday.
• US Dollar Index stays calm near 93.00 following Wednesday’s rebound.
• US Initial Jobless Claims and Canada ADP Employment Change coming up next.

The USD/CAD pair gained nearly 50 pips on Wednesday as the USD gathered strength on the back of FOMC Minutes. Amid the lack of significant fundamental drivers, the pair seems to have gone into a consolidation phase on Thursday and was last seen posting small daily losses at 1.3205.

USD recovery takes a break ahead of Jobless Claims data

Minutes from the FOMC’s July policy meeting showed that most policymakers saw costs to yield caps, targets, including the rapid expansion of balance sheet, difficulties in design and communication. The US Treasury bond yields surged higher in the late American session and helped the greenback continue to outperform its rivals. The US Dollar Index (DXY) erased all the losses it suffered since Monday and rose above 93.00. 

Ahead of the US Department of Labor’s weekly Initial Jobless Claims data and the Federal Reserve Bank of Philadelphia’s Manufacturing Survey, the DXY is moving sideways near 93.00.

On the other hand, the ADP Employment Change data for July will be featured in the Canadian economic docket. Meanwhile, the barrel of West Texas Intermediate trades in a tight range around mid-$42s on Thursday, failing to provide a directional clue to the commodity-related loonie. Later in the day, Paul Beaudry, Deputy Governor of the Bank of Canada, is scheduled to deliver a speech as well.

Technical levels to watch for