British pound gets stronger as the Government changes its tax cut plan

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

US Dollar             1.3750-1.3850

Euro                     1.3400-1.3500

Sterling                1.5425-1.5525

WTI Oil (opening level) $87.46

The US Dollar index had a strong day yesterday as the US inflation report came in worse than expected which will all but ensure at least two more 0.75% interest rate hikes this year with the possibility of a 100% rate hike in November. Surprisingly the US Stock market had a strong day yesterday as well with some financial writers pointing to this as a sign it might be the beginning of the end of the bear market. I think we won't see that until the Fed says the pace of interest rate hikes is going to slow which should be early next year.

The UK Economy is in turmoil at the moment as the Government is set to announce a big claw back in its tax cut plan and the possible firing of the new finance minister. Sterling has pulled back some of its losses on this news as GBP.USD hit a high of 1.1340 before falling back, GBP.CAD reached a high of 1.5620 before falling back lower this morning. Sterling will remain threatened until the Government can sort out this mess of their own making. 

The Canadian Dollar nearly hit 1.4000 (0.7142) yesterday as the stronger US dollar pulled the Loonie lower, it has recovered a little this morning where it traded down near 1.3700 (0.7299) before settling in for the day.

Stocks are again pointing higher this morning as markets get set for the US Retail Sales report for September. Early reports from the Amazon Prime Day sales are pointing to a very quiet holiday season as inflation will reduce the amount people spend on the holidays.