- USD/CAD consolidates gains on Tuesday in the Asain session.
- US Dollar Index stands tall above 92.60 on political tension in Afganistan and risk aversion amid delta variant spread.
- The Canadian dollar weighs down by weaker commodity prices, mixed economic data.
USD/CAD remains muted in the initial trading hour on Tuesday. After testing the high above 1.2580 in the overnight session, the pair consolidates with minute gains.
At the time of writing, USD/CAD is trading at 1.2571, up 0.01% for the day.
The US Dollar Index (DXY), which tracks the performance of the greenback against the six major currencies remains strong at 92.60 with 0.13% gains.
Persistent coronavirus jitters and lower-than-expected Chinese data took a toll on investors sentiment and hurt the demand for riskier assets.
On the other hand, the Canadian dollar failed to impress investors on falling oil prices on demand concerns.
Oil prices continued to decline for the third consecutive session amid demand concerns as the global growth recovery at risk on the spread of the Delta variant of coronavirus. The subdued Chinese data, which is a major consumer of oil, also weighed on the prospects of the WTI prices.
A surprise election call from Prime Minister Justin Trudeau and mixed economic data negatively affected the loonie.
The Manufacturing Sales jumped 2.1% in June, in line with market expectations, whereas Wholesale Sales edged lower 0.8% in June.
As for now, traders are waiting for the US Retails Sales and Fed’s Chair Powell speech to trade fresh trading impetus.