(CEP News) - Weaker Canadian data could be having a slight impact on the Canadian dollar as equity momentum dominates currency markets. A drop in equities is causing a rally in the U.S. dollar across the board. Positive market sentiment caused a modest sell-off in USD/CAD in the Asian session. However, the sentiment dissipated just before the North American open. The cross is trading around the 1.24 level. The Canadian dollar continues to be one of the worst performers against the U.S. dollar. Only the Swedish krona and Norwegian krone are lower than the loonie among the G10 currencies. Dismal Canadian data could have added to the sell-off following a massive fall in building starts and more weakness in the manufacturing sector. Building permits plunged 15.9% month-over-month to $3.7 billion, following the downwardly revised 6.0% decline in January, Statistics Canada reported on Monday. Economists expected a 4.0% decline. In more bad data, Canada's Ivey purchasing managers' index unexpectedly fell to 43.2 in March. Economists had expected a reading of 47.0 following February's 45.2 level. According to some currency strategists, USD/CAD continues to bounce around in a broad range. Support continues to hold around the 1.22 CAD level. Currency strategists from RBC Capital Markets said they would need to see a close below 1.2231 CAD to shift the bullish sentiment against the U.S. dollar. However, they said that if USD/CAD does close below that level, it could lead to a test of 1.2030 CAD.

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