USD index benefits from the stock markets uncertainty

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

US Dollar         1.2750-1.2850

Euro                 1.5350-1.5450

Sterling            1.7400-1.7500

The US Dollar Index is marginally stronger this morning as the Greenback was able to benefit from the stock markets calming down once again and the Euro taking a big hit with EUR.USD falling from a high yesterday of 1.2085 to trade this morning at 1.2010 before levelling off. There are growing issues with the vaccine roll-out in Europe, government discord in Italy and economic growth levels that are trending in the wrong direction, all of which may help keep the Euro trading with a weak bias and give strength to the US Dollar.

The Canadian Dollar had a good night as it was able to hang in against the stronger US Dollar but picked up some gains against both the Euro and Pound. USD.CAD opens the day near the 1.2800 (0.7813) level after trading lower throughout the night. I am beginning to read more and more that the prevailing thought where the US Dollar was going to weaken over the first six months of the year is starting to disappear and more pundits are predicting that the US Dollar may begin to rise as the US recovery takes hold. If that is true then it would not be long before you see USD.CAD back above the 1.3000 (0.7692) level in the coming weeks, US Dollar buyers may want to look at covering some of their exposure in the short-term.

Nothing of note on the calendar for today, USD.CAD should remain range bound and any movement will come from changes in the stock market which is set to open a little lower.