USD.CAD has settled at the 1.2600 level

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

US Dollar             1.2550-1.2650

Euro                     1.4375-1.4475

Sterling                1.6800-1.6900

The US Dollar index is mostly unchanged this morning as markets digest the biggest rise in US inflation since 1990. Market traded US interest rate products are all showing an increase in US interest rates led by the five-year treasury note that reached a February 2020 high. It is clear now that investors are betting that the US Federal Reserve will have to increase their key lending rate earlier than first thought, as long as this remains the situation the US Dollar will remain supported.

The Canadian Dollar had an uneventful night and USD.CAD has settled in around the 1.2600 (0.7937) level for the time being. The Loonie was also able to hold onto its current levels against the other currencies so overall the Canadian Dollar is just sitting tight waiting for the next market move. The oil price has also stabilized at the $80 level so that is not affecting the currency market at this time.

There are reports in the media that Russia is building troops on the Ukraine border and that Belarus is threating to cut off natural gas supplies to Europe if the migrants are not allowed into Poland. Either one of these situations could create severe issues for the financial markets if they develop further so something to keep an eye on.