The GDP report numbers gave the confidence that the Fed is going to make the first rate cut in March

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

US Dollar        1.3250-1.3350

Euro                1.4600-1.4700

Sterling           1.6850-1.6950

WTI Oil (opening level) $74.50

The US Dollar index is weaker this morning as the markets reacted to yesterday's US final third quarter GDP report that showed the economy expanded at 4.9% which was slightly less than expected. As a result, the Greenback fell to the lows of the week and stocks were able to pick up some of the losses from Wednesday. This number gave investors some confidence that the Fed will make it's first interest rate cut possibly in March of next year and make as many as three cuts next year to boost growth.

The Canadian Dollar was able to pick up some strength on the weaker Greenback yesterday as USD.CAD fell to trade at 1.3270 (0.7536) this morning. This is still a US Dollar story as the Loonie did not make any gains against the other currencies so we should still see more Canadian Dollar strength as long as the US Dollar trades with a weak bias. Up today to close out the week we get the Canadian GDP report for November and it is expected that the economy grew 0.2% which is up slightly from the October number of 0.1%. I don't think this number will get the Canadian market all that excited but a weaker number will surely hurt the Loonie.

The calendar also has some US secondary data including some core inflation data so we may yet see some volatility in the market today, a lot of traders have closed down for the holidays and there will be less liquidity in the market so we may see some wild swings before it gets quiet.