USD index rises as markets await the US June Inflation report

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

US Dollar         1.2450-1.2550

Euro                 1.4750-1.4850

Sterling            1.7250-1.7350

The US Dollar Index is marginally stronger this morning as the market turns its focus to the US June Inflation report while keeping their eyes on the growing number of virus cases. For the inflation report the market is expecting the year-over-year inflation number to come in at 4.9%, while this number is considerably higher than is wanted by the Federal Reserve it looks to be that the pace of the increase is starting to slow. If the number is greater than expectation look for the US Dollar to jump much higher and if comes in a lot lower than expectation then the Greenback should fall quite a bit.

The Canadian Dollar has been range trading overnight against its Southern neighbour and has actually picked up some strength against the Euro and Pound. Like most currencies its value today will depend on what happens with the US Dollar so be prepared for some early volatility.

I read this morning that without an agreement at OPEC to increase production the supply of oil will tighten and the price should jump a lot higher in the coming months. It will be interesting to see if this comes to pass and the Loonie can receive some benefit, it is not always certain that the Loonie will benefit from a stronger oil price, there are always other factors at play that must be taken into account. As I write the oil price is $74.26 a barrel just off of the year high.

Once we get the US Inflation report the Canadian market should calm down as they await the Bank of Canada interest rate decision and update on the economy tomorrow.