Election Bets and Fed Cut Speculation Lift USD; CAD Softens Ahead of Inflation Report

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

US Dollar        1.3600-1.3700

Euro                 1.4850-1.4950

Sterling            1.7700-1.7800

WTI Oil (opening level) $79.68

The US Dollar index is marginally stronger this morning as market bets are growing that Trump will win the election in November and the Federal Reserve appears to be set for a September interest rate cut. It is expected that Trump will attack trade and increase tariffs on a wide range of goods coming from other countries with the expectation that he could go as high as 60% on trade from China.

The Canadian Dollar opens the session a little weaker, USD.CAD trades higher near the 1.3680 (0.7310) level as the Canadian market awaits the latest inflation report for June. It is expected that inflation will have again moderated last month which should give the Bank of Canada room to cut interest rates again in July. US Dollar buyers may want to look to grab some in case the Loonie weakens off a lot.

The US gets their latest Retail Sales report today but I doubt it will be enough to move the needle on the Greenback, The US Dollar should remain supported and stocks should continue to benefit from falling interest rates.