The Canadian dollar extended its early gains against its most major rivals in European deals on Monday, as oil prices climbed amid a weaker dollar, and data showed that the U.S. rig count continued to fall for the fifth consecutive week in the week ended October 2.
Data from Baker Hughes showed Friday that the number of oil rig counts fell by 26 to 614, the least since August 2010. The falling rig count is seen as an indication of low U.S. oil output, underpinning crude prices.
Weaker-than-expected US employment data released on Friday dimmed the hopes of imminent hike by the Federal Reserve, thereby weakening the dollar. A weak dollar makes oil-priced commodities more attractive, since they are denominated in dollars.
Russia agreed to meet with OPEC and non-OPEC oil producers to discuss the situation in oil market, its energy minister Alexander Novak said Saturday. Investors responded positively to the news, as Russia has been reluctant to cooperate with OPEC and reduce oil production, to support its market share.
The loonie has been higher against the yen, greenback and the euro in the Asian session. Against the aussie, it declined.
In European trades, the loonie advanced to more than a 2-week high of 1.3064 against the greenback and near a 4-week high of 1.4706 against the euro, up from its previous lows of 1.3175 and 1.4786, respectively. The loonie finished last week’s trading at 1.3150 against the greenback and 1.4738 against the euro. The loonie may possibly find resistance around 1.29 against the greenback and 1.46 against the euro.
The loonie climbed to 92.06 against the yen, its strongest since September 9.
If the loonie-yen pair extends rise, it is likely to find resistance around the 93.00 mark. The pair closed last week’s trading at 91.12.
On the flip side, the loonie that fell to 0.9307 against the aussie at 10:00 pm ET held steady in a short while. At last week’s close, the pair was quoted at 0.9266.
Looking ahead, U.S. service sector PMI report and labor market conditions index, both for September, are slated for release in the New York session.
At 9:00 am ET, euro group finance ministers will hold a meeting in Brussels.
The material has been provided by InstaForex Company – www.instaforex.com