First pandemic budget is going to show how Canadians will pay for all the spending

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

US Dollar         1.2450-1.2550

Euro                 1.5000-1.5100

Sterling            1.7350-1.7450

The US Dollar Index is again lower this morning despite Johns Hopkins University reporting that last week was the worst week ever for global Covid-19 cases around the world with the poorer countries being the hardest hit. The recovery in the US is far ahead of all other countries as stocks continue to push forward, interest rates continue to recover from their peak last month and employment continues to improve. As long as this situation stays the same the US Dollar should remain trading with a weak bias but if interest rates start moving higher again the reverse will happen.

The Canadian Dollar starts the week on a mixed footing, it is stronger against the US Dollar as USD.CAD opens the day at the 1.2490 (0.8006) level but the currency pair is also off of its overnight lows so once again it is not extending any signs of strength. The Loonie is weaker against the other currencies as they were much stronger against the US Dollar overnight than the Loonie was.

The Canadian Dollar should be front and centre this week with the first pandemic budget being released today and then the inflation numbers later in the week. Currency markets will be watching the budget to see just how big the deficit will be and make the decision on how Canadians are going to pay for all this spending.