USD/CAD trades at fresh weekly highs above 1.3000
- Oil extends corrective slide toward $62 on Tuesday.
- Upbeat macroeconomic data from US help greenback gather strength.
- US Dollar Index rebounds above 97 following Monday's drop.
The USD/CAD pair extended its steady climb during the first half of the American session and reached a fresh weekly high of 1.3030 before retreating slightly. As of writing, the pair was up 0.4% on the day at 1.3015.
The lack of fresh developments that could cause the US-Iran conflict to escalate further on Tuesday caused crude oil prices to start correcting the latest upsurge and weighed on the commodity-sensitive loonie. As of writing, the barrel of West Texas Intermediate was down 0.5% on the day at $62.50, slightly above the daily low that it touched at $62.10 earlier in the day.
In the meantime, the Ivey Purchasing Managers' Index (PMI) in Canada fell sharply to 43.6 in December from 58.4 in November to put additional weight on the loonie's shoulders.
USD capitalizes on inspiring data
On the other hand, upbeat macroeconomic data releases from the US on Tuesday allowed the greenback to outperform its rivals and triggered a decisive recovery in the US Dollar Index.
The ISM's Non-Manufacturing PMI in December improved to 55 in December from 53.9 in November and beat the market expectation of 54.5. Other data showed that the US' trade deficit narrowed to $43.1 billion in November from $46.9 billion in October. At the moment, the US Dollar Index is up 0.42% on the day at 97.04.
Technical levels to watch for