USD.CAD opens the day below the 1.2700 for the first time in almost 4 years

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

US Dollar         1.2650-1.2750

Euro                 1.5600-1.5700

Sterling            1.7300-1.7400

It may be 2021 but it is more of the same as the US Dollar index is weaker to start the new trading year, month and week. Optimism abounds that the rollout of the vaccine will lead to a strong US recovery and continue to push stocks higher and the Federal Reserve will continue to keep interest low for all of 2021.

In the UK, Brexit has finally been resolved but now only time will tell what the short-term and long-term effects on the UK economy will be. In the meantime, Sterling is lower as the number of virus cases continues to grow rapidly as that country is now going to face even further lockdowns driving that economy deeper into trouble.

The Canadian Dollar has been able to pickup some gains to start the year as USD.CAD opens the day below the 1.2700 (0.7874) for the first time in almost 4 years. The Loonie also picked up some small gains against both the Euro and Pound so overall a good start to the year. In order for the Loonie to continue to get stronger we will need to see further weakness in the US Dollar which we should do as the US economy slowly recovers.

It will be a busy week for the markets to start back up as we get lots of data on the calendar finished off on Friday by the US and Canadian Employment reports for December. Ahead of that the US Dollar should remain weak and North American Stocks will remain positive.