The Canadian dollar extended its early gains against its major rivals in European deals on Wednesday, as oil prices rallied after data showed that U.S. crude oil inventories declined last week.
Crude for February was up 70 cents at $36.84 a barrel.
The American Petroleum Institute report showed late Tuesday that U.S. crude oil inventories fell 3.6 million barrels in the latest week.
Although the loonie trimmed some of its gains after the release of Canadian data, it reversed direction in a short while.
Data from Statistics Canada showed that the gross domestic product was unchanged in October, contradicting economists forecast for a 0.2 percent rise. The GDP contracted by 0.5 percent in September.
Annually, the GDP fell 0.2 percent after a 0.1 percent gain a month earlier. Economists had been forecasting an economic contraction of 0.1 percent.
Separate data showed that retail sales edged up 0.1 percent on month in October to C$43.4 billion. This was down from forecasts for a 0.4 percent rise, following the 0.4 percent decline last month.
Excluding autos, the retail sales were flat on month – down from the expected 0.4 percent growth. Consensus estimate called for a decline of 0.4 percent.
The loonie showed mixed performance in the previous session. While the currency held steady against the yen and the greenback, it advanced against the euro. Against the aussie, it declined.
The loonie rallied to a 2-day high of 1.5146 against the euro, compared to yesterday’s closing value of 1.5249. Further gains may take the loonie to a resistance around the 1.50 region.
The loonie climbed to 1.3881 against the greenback, its highest since December 18. The loonie is seen finding resistance around the 1.36 mark. The pair ended yesterday’s trading at 1.3919.
Reversing from an early low of 86.69 against the yen, the loonie firmed to a 2-day high of 87.15. On the upside, 88.00 is possibly seen as next resistance level for the loonie-yen pair.
The loonie hit a 2-day high of 1.0014 against the aussie, off its early low of 1.0084. The next possible resistance for the loonie is seen around the 0.99 zone.
The material has been provided by InstaForex Company – www.instaforex.com