Market Turbulence: US Dollar Weakens as Investors Shift to Safe Havens Amid Tech Selloff and BoC Rate Cut

Today's expected range for the Canadian Dollar against the major currencies:

US Dollar        1.3800-1.3900

Euro                 1.4950-1.5050

Sterling            1.7775-1.7875

WTI Oil (opening level) $76.05

The US Dollar index is weaker this morning as the market reacts to a big selloff in global stocks that started yesterday afternoon and continued into the overnight session. From everything I read it looks like investors are pulling out of the tech heavy AI companies and moving into safe haven investments like US treasuries while the latest developments in the US election play out.

The Canadian Dollar is much weaker this morning as the Loonie could not take advantage of the weaker US Dollar. As expected, the Bank of Canada cut the key lending rate a quarter point for the second time this year where it now stands at 4.5%, more importantly the Bank indicated that as long as inflation remains subdued there are more interest rate cuts coming. USD.CAD reached a high of 1.3840 (0.7225) before recovering a little overnight. The Loonie also lost ground to the other currencies and a continuing drop in the oil price will help make any recovery difficult. It now looks like the 1.4000 (0.7143) level is quite possible later this year, we will see how it plays out over the coming months.

The marker will have a busy few days with the first look at the US 2nd Quarter GDP report due out today and tomorrow the market releases US inflation data in the form of CORE Price index which is the Fed's preferred data on inflation. Stocks are poised for another negative day today and if investors money keeps pouring into US treasury bonds then we may see the Greenback stage a bit of a recovery.