Investors around the world are focused on oil prices

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

US Dollar         1.2050-1.2150

Euro                 1.4675-1.4775

Sterling            1.7050-1.7150

The US Dollar Index is marginally stronger this morning as both the Euro and Sterling traded lower during the overnight session yesterday. The US Dollar edged a little higher yesterday as improved manufacturing data showed continued evidence that the US economy is well on the road to recovery.

The Canadian Dollar gave up some gains both yesterday and last night, USD.CAD had traded at a low of 1.2007 (0.8328) early yesterday which was a fresh 6 year high for the Canadian Dollar. That being said once again USD.CAD was not able to break below the 1.2000 (0.8333) level so that particular level looks to be one of significance where the Loonie will need a significant rally to get through.

The price of a barrel of oil seems to be front and centre on the minds of global investors at the moment as it maintains above the $68 USD a barrel price. OPEC released a report this morning that they see the global demand for oil growing which will ensure the need to increase supply but, in the meantime, it does not look like Iran will be allowed to release any supply into the global economy for a few months yet. The relationship between the Canadian Dollar and the price of oil is always a complex one and not as straight forward as some make it out to be. For the moment the Loonie is getting a small benefit from the recent rise in the oil price but it is still not enough to push USD.CAD below the 1.2000 (0.8333) level.

Yesterday saw the annualized first quarter Canadian growth rate come in at 5.6% which was below the market consensus of 6.7%. It is a strong enough number but as it did not meet the market expectation the Loonie was not able to extend any gains after tis release.

Currency markets should remain steady today as we only have some secondary US inflation data on tap along with a group of US Federal Reserve officials giving speeches around the country. I doubt they will say anything new so look for USD.CAD to remain steady around current levels.