Market Update: USD Rises Amid Election Uncertainty, CAD Weakens Ahead of BoC Decision

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

US Dollar        1.3750-1.3850

Euro                 1.4900-1.5000

Sterling            1.7750-1.7850

WTI Oil (opening level) $77.29

The US Dollar index is marginally stronger this morning as the markets must now start to price in the possibility of Harris winning the election. Markets had been looking at an easy Trump victory as positive for the Dollar on the back of trade tariffs but with Harris pulling ahead on the most recent polls a Harris presidency would mean more of the status quo in economic policy so the Dollar may not benefit as much going forward.

The Canadian Dollar is weaker this morning as USD.CAD again approaches 1.3800 (0.7246) as the market awaits word from the Bank of Canada this morning. It is fully expected that the BOC will cut interest rates a quarter point for the second time this year which I think will drive the Loonie a little weaker this morning but more importantly will be any statements from the Bank on future interest rate cuts. If they feel another rate cut is needed in September then the Loonie will fall off dramatically.

Another quiet day on the US calendar after a down day yesterday, stocks are poised for a big drop on the opening as both Tesla and Google parent Alphabet posted disappointing results last night so the US Dollar may be able to post early gains this morning.