(November 08, 2017) The U.S. dollar dropped against its Canadian counterpart on Wednesday, after the release of upbeat Canadian housing sector data and amid uncertainty over the fate of a highly-anticipated U.S. tax reform bill.
USD/CAD was down 0.41% at 1.2728 by by 09:30 a.m. ET (13:25 GMT).
Statistics Canada reported on Wednesday that building permits increased 3.8% in September, confounding expectations for a 0.2% fall. Building permits declined 5.1% in August, whose figure was revised from a previously estimated 5.5% drop.
Another report also showed that housing starts increased by 222.800 units last month, surpassing expectations for a 210,000 rise. The number of housing starts increased by 219,300 in September, whose figure was revises from a previously estimated 217,100 gain.
Meanwhile, sentiment on the greenback remained vulnerable following reports that a key corporate tax cut currently under discussion in U.S. tax reforms plans could be delayed for one year.
The Washington Post reported on Tuesday that Senate Republican leaders are thinking of postponing the implementation of the major corporate tax cut to comply with Senate rules.
The U.S. dollar had been supported in recent session by hopes the U.S. administration’s tax cuts could boost the economy. If enacted, the tax reform bill would be the biggest overhaul of the U.S. tax system since the 1980s.
It would also be the first major legislative achievement since Republicans took control of the White House and Congress in January, but doubts remain over the scale of borrowing needed to finance the bill and the timetable for its passage this month.
The loonie was higher against the euro, with EUR/CAD shedding 0.31% to 1.4761.