Investing.com - The U.S. dollar slid lower against its Canadian counterpart on Friday, but remained within close distance of four-and-a-half year highs after Canadian inflation data came in in line with expectations.
USD/CAD hit 1.1053 during early U.S. trade, the pair''s lowest since Wednesday; the pair subsequently consolidated at 1.1078, down 0.20%.
The pair was likely to find support at 1.0954, Wednesday''s low and resistance at 1.1174, Thursday''s high and a four-and-a-half year high.
Official data showed that Canada''s core consumer price inflation, which excludes the eight most volatile items, fell 0.4% last month, in line with expectations, after a 0.1% downtick in November.
Consumer price inflation slipped 0.2% in December, as expected, following a flat reading the previous month.
The loonie had strengthened on Thursday after data showed that retail sales rose 0.6% in November, surpassing expectations for a 0.3% increased, recovering from a 0.1% decline in October.
Core retail sales, which exclude auto sales, rose 0.4% in November, slightly higher than forecasts for a 0.3% gain, but slowing from growth of 0.5% in October.
But demand for the Canadian currency remained under pressure after the Bank of Canada expressed concern over the inflation outlook on Wednesday, and left the way open for a rate cut, saying the path of the next rate move would depend on economic data.
Meanwhile, the greenback remained under pressure after data on Thursday showed that initial jobless claims rose in line with expectations last week, but the number of continuing jobless claims remained above the three million mark for the second successive week.
In addition, U.S. factory output fell to a three-month low in January, due to disruption from unseasonable cold weather.
The loonie was higher against the euro, with EUR/CAD shedding 0.19% to 1.5173.
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