USD/CAD struggles to rise above 1.32 on surging crude oil prices
- WTI recovers to mid-$57 area following Wednesday's drop.
- US Dollar Index clings to modest daily gains near 98.
- Coming up on Friday: Canadian labour market report.
For the second straight day on Thursday, the USD/CAD pair struggled to gather enough momentum to break above the 1.32 mark. With crude oil prices gaining traction following Wednesday's pullback, the commodity-related loonie stays resilient against the dollar. As of writing, the pair was virtually unchanged on a daily basis at 1.3180.
Trade optimism boosts oil prices
Reports suggesting that the United States and China have agreed to cancel existing tariffs reciprocatively in different phases on Thursday eased concerns over the potential negative impact of a global economic slowdown on the energy outlook and allowed the barrel of West Texas Intermediate (WTI) to retrace Wednesday's slump. At the moment, the WTI is trading around $57.50, up 1.8% on the day.
On the other hand, the poor performance of major European currencies, especially the GBP amid the Bank of England's dovish tone, on Thursday helps the greenback preserve its strength and limits the pair's losses with the US Dollar Index clinging to modest daily gains near the 98 handle.
The next significant catalyst for the pair will be Friday's labour market report from Canada. Experts expect the unemployment rate in Canada to stay unchanged at 5.5% in October with a 15.9K net increase in the number of employed.
Technical levels to watch for