Canadian Dollar Higher After Strong Consumer Inflation Data

The Canadian dollar strengthened against its major counterparts in early New York deals on Friday, as a data showed that the nation's consumer inflation improved in July.

Data from Statistics Canada showed that the CPI rose 0.5 percent on a seasonally adjusted monthly basis in July, following a 0.2 percent increase in June.

The rate was forecast to edge up to 0.1 percent.

On year, the CPI climbed to 3.0 percent in July, after recording a 2.5 percent increase in June.

The loonie traded mixed against its major rivals in the Asian session. While it held steady against the euro and the aussie, it fell against the yen. Against the greenback, it rose.

The loonie climbed to 0.9511 against the aussie, reversing from a session's low of 0.9574 hit at 3:00 am ET. If the loonie rises further, 0.93 is likely seen as its next resistance level.

Having dropped to 1.3169 against the greenback at 7:15 pm ET, the loonie reversed direction and climbed to a 2-day high of 1.3070. The next possible resistance for the loonie is seen around the 1.28 region.

The loonie advanced to 1.4897 against the euro, from a 4-day low of 1.5000 touched at 3:00 am ET. The loonie is poised to challenge resistance around the 1.47 region.

Final data from Eurostat showed that Eurozone inflation accelerated for a third straight month in July, as initially estimated, to its highest level since late 2012.

The harmonized index of consumer prices rose 2.1 percent year-on-year in July, after climbing 2 percent in June.

Reversing from an early 2-day low of 83.86 against the yen, the loonie strengthened to 84.48. Continuation of the loonie's uptrend may see it challenging resistance around the 86.00 level.

Looking ahead, University of Michigan's preliminary consumer sentiment index for August is due shortly.