USD index shows signs of rebound after losing 4% in the end of last week

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

US Dollar             1.3250-1.3350

Euro                     1.3650-1.3750

Sterling                1.5600-1.5700

WTI Oil (opening level) $88.10

The US Dollar index is marginally higher this morning as markets are showing signs that investors may have overreacted to the larger than expected drop in US inflation late last week. The Dollar index dropped over 4% last week which was its biggest weekly drop in over 2 and a half years but investors have moderated their jubilation as this week kicks off.

The highlight of the week should be the meeting between Biden and Chinese President Xi later tonight which will be the first high level meeting between the two countries since the pandemic started. If markets like the outcome of the meeting you may see global stocks move higher and the dollar give back some more gains.

The Canadian Dollar gave back some gains to the stronger overnight dollar and for the moment it looks like the 1.3250 (0.7547) level is the best the Loonie has seen so far on this run. On Wednesday of this week, we get the October Canadian inflation report which may give bring some movement to the Loonie, ahead of that it should remain fairly stable but of course depends on what the US Dollar does.

Nothing of note on the calendar today, stock markets are pointing to a small gain on the opening and will most likely remain steady ahead of the leaders meeting tonight in Indonesia.