The Canadian dollar rallied to more than two week highs against the U.S. dollar on Friday before later retracing most of those gains, after a revised jobs report showed that the Canadian economy added more jobs than expected in July.
USD/CAD fell to lows of 1.0860 before pulling back to 1.0896 late Friday. For the week, the pair lost 0.67%.
The pair is likely to find support at around the 1.0850 level and resistance at 1.0940.
Statistics Canada reported that the economy added 41,700 jobs in July, well above the original estimate of just 200 jobs and ahead of expectations for jobs growth of 20,000.
The unemployment report ticked down to 7% from 7.1% in June.
The statistics agency released a revised version of the employment report after detecting an error in the original jobs report released on August 8.
Safe haven demand for the greenback continued to be underpinned on Friday as heightened geopolitical tensions soured market sentiment.
Tensions over the crisis in Ukraine escalated following reports that Ukraine's military attacked and destroyed a number of armored vehicles that entered the country from Russia.
In the U.S., data on Friday showed that industrial output rose at a faster than expected rate in in July.
Official data showed that industrial output was up 0.4% in July, compared with forecasts of a 0.3% increase. Output growth for June was revised up to 0.4%.
A separate report showed that U.S. producer prices slowed to 0.1% in July from 0.4% the previous month.
In the week ahead, investors will be looking ahead to Wednesday’s minutes of the Federal Reserve’s latest meeting, while Canada is to release data on retail sales and inflation on Friday.
Ahead of the coming week, Investing.com has compiled a list of these and other significant events likely to affect the markets.
Monday, August 18
Canada is to release data on foreign securities purchases.
The U.S. is to produce private sector data on the housing market.
Tuesday, August 19
The U.S. is to release reports on building permits, housing starts and consumer inflation.
Wednesday, August 20
Canada is to release data on wholesale sales.
Later Wednesday, the Federal Reserve is to publish the minutes of its latest policy meeting.
Thursday, August 21
The U.S. is to produce data on unemployment claims, manufacturing activity and existing home sales.
The first day of the annual economic symposium is due to take place in Jackson Hole, Wyoming.
Friday, August 22
Canada is to release data on retail sales, the government measure of consumer spending, which accounts for the majority of overall economic activity. The country is also to produce data on consumer inflation.
Fed Chair Janet Yellen is to speak at the second day of the annual economic symposium in Jackson Hole, Wyoming.