Forex – USD/CAD slips lower with eyes on Fed speech

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Forex - USD/CAD slips lower with eyes on Fed speech

The U.S. dollar slipped lower against its Canadian counterpart on Monday, as investors eyed a speech by Federal Reserve Chair Janet Yellen due later in the day, while Friday’s downbeat U.S. employment data continued to weigh.

USD/CAD hit 1.2908 during early U.S. trade, the pair’s lowest since May 26; the pair subsequently consolidated at 1.2920, slipping 0.12%.
The pair was likely to find support at 1.2834, the low of May 17 and resistance at 1.3107, Friday’s high.

The Labor Department reported on Friday that the U.S. economy added just 38,000 jobs last month, the smallest increase since September 2010. Economists had forecast that payrolls would increase by 164,000.

April’s number was revised down to 123,000 from an earlier estimate of 160,000.
The unemployment rate fell to 4.7% from 5% in April as more people dropped out of the labor force.

The weak data cast doubts over the prospects for a rate hike by the Fed in the coming months and sparked renewed concerns over slowing global growth.
Market participants were looking to a speech by Fed Chair Janet Yellen, scheduled later in the day for further indications on the central bank’s next policy moves.

Meanwhile, the commodity-related Canadian dollar found support, as Crude Oil moved sharply higher on Monday amid supply disruptions in Nigeria and Libya.
The loonie was lower against the euro, with EUR/CAD shedding 0.28% to 1.4661.

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