The Canadian dollar extended its previous session’s decline against major rivals ahead of the Wall Street opens on Thursday as the price of crude oil trimmed its recent gains amid ongoing eurozone debt problem and slower growth in the U.S.
Light Sweet Crude Oil (WTI) futures for July delivery slipped below the $95 a barrel and is presently trading at $94.84 a barrel, after having reached $94 mark on Wednesday, its lowest level in four months.
Wednesday, the EIA revealed U.S. crude oil inventories decreased by 3.40 million barrels, while gasoline stocks moved up by 600,000 barrels in the week ended June10. Analysts were expecting crude oil stocks to dip 1.9 million barrels, while gasoline stocks to move up 1.3 million barrels.
Earlier today, the International Energy Agency, in its monthly Oil Market Report, nudged up its 2011 global oil product demand growth by 0.10 million barrels per day or mbd to 1.3 mbd.
The Canadian dollar that advanced to nearly a 3-week high of 1.3828 against the euro in the Asian session reversed its course in the succeeding trading hours. The loonie then reached as low as 1.3946 against the euro before leveling off around 8:25 am ET. The euro-loonie pair is presently trading at 1.3940.
Eurozone annual inflation eased to 2.7 percent from April’s 2.8 percent, in line with the preliminary estimate, Eurostat said. Economists had expected the preliminary figure to be confirmed.
Meanwhile, core inflation that excludes fresh food and energy rose to 1.7 percent from 1.6 percent. Economists had forecast the rate to remain unchanged. The figure was the highest since April 2009, when it was 1.8 percent.
Month-on-month, prices were flat in May, after a 1.6 percent gain in April. The result matched economists’ expectations.
Meanwhile, the number of employed persons in Eurozone remained unchanged in the first quarter, figures from Eurostat showed today. Employment in euro area recorded no growth compared to the previous quarter after adjusting to seasonal variations, but advanced 0.1 percent from last year.
Against the yen, the Canadian dollar slipped to a 1-week low of 81.56 around 8:20 am ET. The loonie-yen pair is presently worth 81.90 with 81.20 seen as the next likely downside target level.
The Canadian dollar fell to 0.9901 against the US dollar around this time and this set the lowest point for the domestic unit since March 17. On the downside, the loonie may find target around the 0.9960 level.
New claims for unemployment insurance by U.S. workers dropped more than expected in the week ending June 11th, according to figures released today by the Department of Labor.
On a seasonally adjusted basis, initial claims fell by 16,000 to 414,000, from the previous week’s revised estimate of 430,000.
Looking ahead, the results of the Philadelphia Federal Reserve’s manufacturing survey are due out at 10 am ET. Economists expect the diffusion index of current activity to show a reading of 9 for June.