Good session for the loonie, taking advantage of broad, although light, USD weakness. USDCAD closed below 1.3150, with the CAD strengthening around 0.20% to settle at 1.3136 versus the USD. The CAD was able to outperform the greenback despite declining WTI crude prices, on the other hand, the USD couldn’t outperform other major currencies despite a spike in US yields.
The primary catalyst of the loonie strength was the Existing Home sales data, which came much stronger than expected (4.1% in June versus 1.7% expected). The CAD rallied more than 0.30% on the news, with USDCAD dropping as far as 1.3113, first support for the pair. On the upside, short-term resistance is still sitting at 1.32
The Canadian economic calendar is light with just Manufacturing Shipments month over month for May which is at 1.4% well above the consensus of 0.5% and previous of -1.1%. The loonie has not been able to make gains on its currency counterparts after the data was released, as declining oil prices start to take their toll on the petrol currency.