Investing.com - The U.S. dollar climbed to 20-month highs against the Canadian dollar on Friday, boosted by expectations that the Federal Reserve is close to scaling back its asset purchase program and after the release of disappointing Canadian economic data.
hit 1.0487 on Friday; the pair’s highest since late November 2011, before trimming gains to settle at 1.0451, up 0.73% for that day and extending the week’s gains to 2.67%.
The pair is likely to find support at 1.0361, Friday’s low and resistance at 1.0487, Friday’s high.
The greenback strengthened across the board after Fed Chairman Ben Bernanke said Wednesday that the bank could begin slowing its USD85 billion-a-month bond purchasing program by the end of 2013 and wind it down completely by the middle of 2014 if the economy picks up as the central bank expects.
The bank said it expects the U.S. economy to grow between 2.3% and 2.6% in 2013. The Fed also said it expects the unemployment rate to fall to between 6.5% and 6.8% by the end of 2014 and inflation to edge closer to its 2% target.
The Canadian dollar came under pressure on Friday after official data showed that Canadian consumer inflation rose less-than-expected in May, and Canadian retail sales came in below expectations in April.
Statistics Canada said consumer price inflation rose 0.7% compared to a year earlier in May, compared to forecasts for a 1% increase, while core inflation was 1.1% year-over-year, in line with expectations.
A separate report by Statistics Canada said retail sales rose 0.1% in April, below expectations for a 0.2% increase, following a flat reading in March.
In the week ahead, investors will be closely watching U.S. data on durable goods orders, jobless claims and consumer confidence for signs that the economic recovery is on track. Friday’s monthly data on Canadian economic growth will also be in focus.
Ahead of the coming week, Investing.com has compiled a list of these and other significant events likely to affect the markets. The guide skips Monday as there are no relevant events on this day.Tuesday, June 25
The U.S. is to publish official data on durable goods orders, a leading indicator of production, as well as closely watched reports on consumer confidence and new home sales.Wednesday, June 26
The U.S. is to release revised data on first quarter economic growth as well as government data on crude oil stockpiles.Thursday, June 27
The U.S. is to release the weekly government report on initial jobless claims along with data on personal income and expenditure, which is to be followed by private sector data on pending home sales.Friday, June 28
Canada is to publish its monthly report on gross domestic product, the broadest indicator of economic activity and the leading measure of the economy’s health.
The U.S. is to round up the week with a report on manufacturing activity in Chicago and revised data from the University of Michigan on consumer sentiment.