USD/CAD continues to push higher toward 1.2600 ahead of key US data
- USD/CAD is edging higher for the second straight day.
- US Dollar Index stays in the positive territory above 92.20.
- Focus shifts to March CPI data from US.
The USD/CAD pair posted modest gains on Monday and preserved its bullish momentum during the first half of the day on Tuesday. As of writing, the pair was trading at a fresh session high of 1.2593, gaining 0.26% on a daily basis.
DXY gains traction on Tuesday
The broad-based USD strength on the back of rising US Treasury bond yields seems to be helping USD/CAD climb higher. Currently, the benchmark 10-year US T-bond yield is up 1% on the day at 1.685% and the US Dollar Index is rising 0.16% at 92.23.
Meanwhile, the commodity-sensitive loonie continues to have a difficult time capitalizing on rising crude oil prices. At the mıoment, the barrel of West Texas Intermediate (WTI) is rising 1% at $60.22.
Later in the session, the US Bureau of Labor Statistics will release its inflation report. Investors expect the Core Consumer Price Index, which strips volatile food and energy prices, to rise to 1.5% on a yearly basis in March from 1.3% in February. A stronger-than-expected reading could allow yields to push higher and provide a boost to the greenback. Earlier in the day, the monthly report published by the NFIB showed that the Business Optimism Index in the US improved to 98.2 in March from 95.8 in February.
There won't be any macroeconomic data releases featured in the Canadian economic docket.
Technical levels to watch for