The oil price continues to run higher, which is a big inflationary pressure

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

US Dollar        1.3450-1.3550

Euro                1.4150-1.4250

Sterling           1.6400-1.6500

WTI Oil (opening level) $93.15

The US Dollar index is unchanged this morning as the market awaits the final 2nd quarter GDP reading. The US economy is expected to have grown 2.1% in the quarter which on its own would give enough room for the Federal Reserve to increase interest rates in November. Becoming a bigger worry now could be the rapid rise in oil prices over the last couple of months, yesterday saw the oil price spike above the $95 a barrel price for the first time since May of this year. Fed Chair Powell is speaking today and I am sure he will have to address how this renewed inflationary pressure will affect his interest rate plans.

The Canadian Dollar was able to make some small gains against the Greenback overnight but it still trades above the 1.3450 (0.7435) level so no significant movement. If the oil price continues to run higher then the Loonie should gain a little strength but I would say that would be limited as any increases in oil would be considered inflationary and also help to push the US Dollar higher.

Stocks were lower again yesterday and should react strongly to the GDP report, It could be a busy morning so get ready with your orders of the Loonie moves around.