Forex - USD/CAD steady after U.S. housing data

Forexpros - The U.S. dollar was steady against its Canadian counterpart on Tuesday, hovering close to a 12-day low after worse-than-expected U.S. housing data and amid ongoing concerns over the debt crisis in the euro zone.

USD/CAD hit 1.0178 during early U.S. trade, the pair’s lowest since December 9; the pair subsequently consolidated at 1.0203, inching down 0.01%.

The pair was likely to find support at 1.0136, the low of December 1 and resistance at 1.0262, the high of December 9.

With markets in Canada remaining closed for an extended holiday break and most investors already away on year-end leave, trading volumes were low, resulting in subdued trade.

Data showed that the U.S. S&P/Case-Shiller home price index fell more-than-expected in October, declining for the 16th consecutive month.

In a report, Standard & Poor with Case-Shiller said its house price index fell at an annualized rate of 3.4% in October, disappointing expectations for a 3.2% decline.

Sentiment also came under pressure ahead of highly anticipated Italian bond auctions later in the week, as the yield on Italian ten-year bonds rose earlier above the 7% threshold, a level widely considered to be unsustainable.

Markets were also jittery after data showed that the use of the European Central Bank's overnight deposit facility reached a new, all-time high Monday, adding to speculation that the central bank’s three-year loan operation last week did little to strengthen the region’s banking sector.

Meanwhile, the loonie remained supported as light, sweet crude futures for delivery in February traded at USD99.89 a barrel on the New York Mercantile Exchange, adding 0.04%.    

Raw materials, including oil account for about half of Canada’s export revenue.

The loonie was fractionally lower against the euro with EUR/CAD edging up 0.01%, to hit 1.3327.

Later in the day, the U.S. was to publish data on consumer confidence.