USD index falls as US stock market manages to gain back some losses

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

US Dollar         1.2650-1.2750

Euro                 1.4900-1.5000

Sterling            1.7250-1.7350

The US Dollar Index is marginally weaker this morning as the Greenback takes a break from its rally of the past week, once again it is the Delta variant that is solely preoccupying investors as cases around the world surge among the unvaccinated. Australia has more than half of their population under lockdown and South Korea and Thailand are reporting record infections. Stocks managed to claw back some of their losses but at the moment they look very vulnerable to an increase in global cases.

In inflation news, the European Central Bank announced that their polices would change to allow for inflation to run above 2% for a period of time, another central bank that will continue to add stimulus to their economy to combat the effects of the virus.

The Canadian Dollar was able to pick up some gains against the US Dollar and other currencies last night as USD.CAD is back below 1.2700 (0.7874) level, as markets still look nervous, I would suggest that there is still room for the US Dollar to weaken and US Dollar buyers need to be ready to take advantage of any short-term Canadian Dollar strength. We also get the first oil inventory report since the recent OPEC agreement on production, if the market see's oil inventories rising the Loonie may get hit on a falling oil price. Currently the price of a barrel of Oil is at $68.10 USD.

Nothing of note on the calendar today, stocks are point a little higher on the opening so we could be in for a positive day with the US Dollar giving back some more gains.