CAD have lost some strength against Euro

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

US Dollar         1.2000-1.2100

Euro                 1.4700-1.4800

Sterling            1.7050-1.7150

The US Dollar Index is marginally weaker this morning to start the last full trading week of May. US Dollar traders are still singularly focused on the Fed and their reaction to the rise in inflation but for the moment the Federal Reserve continues to hammer the point that they will keep interest rates low and let inflation run hot over the short-term in order to keep the stimulus to the economy flowing. As long as this is the case the US Dollar should continue to trade with a weak bias but I watch with interest for the day that the Fed changes their policy and starts to consider interest rate hikes, that should see the Dollar jump significantly.

The Canadian Dollar continues to hold onto most of its recent strength with the exception being against the Euro where it lost a little ground last night. USD.CAD opens the day at the 1.2045 (0.8302) level so it is hanging in quite nicely against the Greenback. China has started a program to clamp down on big prices increases in various commodity products so we are seeing a big pullback in commodity prices over the last few days which has helped to slow the progress of the Loonie and other commodity currencies.

We have also seen a small jump in the price of oil over the last few sessions as talks with Iran on allowing them back into the world economy seem to progressing. With everything I have read the world's growing appetite for oil led by the ongoing pandemic recovery seems to be pricing in an increase in supply from Iran, if Iran is in fact allowed to sell their supply on the global market it should not affect the price all that much and as a result the Loonie and other commodity currencies should not be severely affected.

A quiet week ahead on the economic calendar so look for USD.CAD to remain range bound for the day and we will see what the rest of the short trading week brings.