USD index gets stronger after the big Dow Jones drop yesterday

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

US Dollar         1.2700-1.2800

Euro                 1.5600-1.5700

Sterling            1.7300-1.7400

The US Dollar Index is unchanged this morning but that was after it had a big rally yesterday. The Dow Jones had a big drop yesterday as the surge in virus cases, a perceived delay in the roll-out of vaccine deployment and the possibility of the Democrats taking both seats in Senate seats in Georgia all spooked US investors and pushed them into safe-haven assets.

The only currency the that the Greenback made some gains last night on was the Pound as that economy has been placed in a country wide lock-down that will bring the economy to a halt for a least a month. This will not be a good start to the post-Brexit era in the UK and that economy will be in serious trouble.

The Canadian Dollar had a tough day yesterday as it gave back a lot of the gains it made against the US Dollar to start the year. USD.CAD moved back higher by some 120 points and opens the day at the 1.2750 (0.7843) level as the Loonie reacted to the big drop in the Dow Jones and the rise in the US Dollar, funny enough the TSX had a positive day but that did not help the Loonie. Once again to continue a theme from 2020 as we see the Canadian Dollar reacting to events south of the border, I think we will still see further Canadian Dollar strength going forward this year but we will also see days like yesterday when the Loonie trading can be quite volatile.

Nothing of note on the calendar for today, keep any eye on early polling from Georgia as signs of a Democratic sweep may lead to further volatility in the US Stock Market and push the US Dollar higher.