American dollar trades near 20-year highs as stocks crash

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

US Dollar             1.2800-1.2900

Euro                     1.3500-1.3600

Sterling                1.5800-1.5900

WTI Oil (opening level) $110.25 (Oil price is up $2 from yesterday's opening level)

After a strong day yesterday the US Dollar Index is a little lower this morning but still trades near a 20-year high. Yesterday saw the US Dollar jump as stocks were absolutely crushed with the Dow Jones down over 1,000 points, the Nasdaq dropped over 5% and the TSX down almost 500 points, a complete wipeout of billions of dollars in wealth in a single day. It is beginning to look like investors are not sure the recent and future moves by the world's central banks will be enough to bring inflation under control and prevent a global recession. It is going to be a tough time for equity investors for the rest of this year.

The Canadian Dollar gave back some strength against the US Dollar but did manage to hold onto some gains against the Euro and Pound. Going forward the Loonie will continue to be at the mercy of the US Dollar and if as expected the Greenback continues to move higher than our dollar will suffer.

Today is employment day in North America and in the US the market is expecting some 390K new jobs to have been created last month so the US labour market will remain tight going forward, in Canada we are expecting some 40K new jobs to have come back after recent lockdowns. With stocks already pointing lower on the opening we could have some wild volatility again this morning if these employment numbers disappoint the market.