Currency markets remain quiet ahead of Friday's US Employment report

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

US Dollar             1.2550-1.2650

Euro                     1.4850-1.4950

Sterling                1.7300-1.7400

The US Dollar Index is marginally higher this morning as the markets move away from comments made last week by Fed Chair Powell and start to focus on the US August employment data. A strong employment report should give the Fed the necessary conditions to start to cut back on their stimulus plan, ahead of employment data markets are fairly quiet but the Greenback is reacting to some weaker that expected economic data out of China and Europe.

Yesterday saw the Canadian economy report some worrying data as the annualized 2nd quarter GDP report showed a big drop as the economic growth of the country retreated by 1.1% where it was excepted by economists to have grown by 2.5%. I will watch with interest to see how this plays out on the election campaign.

USD.CAD as you would expect initially jumped higher on this news as the Loonie racked up some losses, the currency pair traded at a high of 1.2645 (0.7908) in the afternoon but the Loonie has recovered somewhat overnight and we now sit below the 1.2590 (0.7943) level which when you consider the poor news it not all that bad a performance for the Canadian Dollar.

We get some trade data on both sides of the border this morning but for the most part the currency market should remain quiet so look for some range trading for the Loonie ahead of Friday's US Employment report.