EURCAD Euro vs Canadian Dollar

The Canadian dollar strengthened against its major counterparts in the early European session on Wednesday, as oil prices rose after data showed larger than expected draw in crude oil inventories, in a sign of reduction in global oversupply.

Crude for May delivery rose $0.51 to $51.54 per barrel.

Data from the American Petroleum Institute showed that crude oil inventories fell by 1.83 million barrels in the week ended March 31. Analysts had expected a smaller draw of 0.3 million barrels.

The Energy Information Administration will publish its official data later in the day, with economists widely expecting a reduction of 200,000 barrels in crude inventories last week.

Further underpinning oil prices were the suspension in oil production at the Buzzard oil field in the North Sea due to technical problems.

Investors await this week's crucial summit between U.S. President Donald Trump and Chinese President Xi Jinping, with trade issues and North Korea's nuclear development expected to be high on the agenda.

The ADP private payrolls report and minutes from the U.S. Federal Reserve's March meeting are due later today, which would shed further clues about the Fed's interest rate path.

The loonie showed mixed performance in the Asian session. While the loonie rose against the aussie and the yen, it held steady against the greenback and the euro.

The loonie rebounded to 1.0138 against the aussie, from a low of 1.0161 hit at 2:45 am ET. The currency had set a 2-day high of 1.0128 at the commencement of today's trading. The next possible resistance for the loonie may be found around the 1.005 region.

The latest survey from the Australian Industry Group showed that Australia's service sector swung to expansion in March, with a Performance of Service Index score of 51.7.

That's up from 49.0 in February, and it moves above the boom-or-bust line of 50 that separates expansion from contraction.

The loonie rose to 1.3386 against the greenback and 1.4281 against the euro, from its early lows of 1.3409 and 1.4314, respectively. Continuation of the loonie's uptrend may see it challenging resistance around 1.326 against the greenback and 1.41 against the euro.

The loonie that closed yesterday's trading at 82.60 against the yen advanced to 82.85. If the loonie-yen pair extends gain, 85.00 is possibly seen as its next resistance level.

The latest survey from Nikkei showed that Japan's services sector continued to expand in March, and at an accelerated pace, with a 19-month high PMI score of 52.9.

That's up from 51.3 in February, and it moves further above the boom-or-bust line of 50 that separates expansion from contraction.

Looking ahead, U.S. ADP private sector jobs data for March, U.S. Markit's services PMI for March and U.S. crude oil inventories data are slated for release in the New York session.

At 8:30 am ET, Bank of England external MPC member Gertjan Vlieghe is expected to speak at Bloomberg, in London.

At 2:00 pm ET, the Fed releases minutes from the March meeting.

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