Canada’s inflation rate slowed to 3.1%, lower than market expectations

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

US Dollar        1.3675-1.3775

Euro                1.4925-1.5025

Sterling           1.7150-1.7250

WTI Oil (opening level) $76.09

The US Dollar index is marginally higher this morning as the currency market pushed the dollar forward on the release of the minutes from the last Fed meeting yesterday. As expected, the committee indicated that they will proceed with great caution and keep interest rates high as long as necessary to combat inflation but they did indicate they are concerned with the effect high interest rates are having on households and businesses. The earliest bets for a drop in US interest rates are the Spring of next year so any further declines in the US Dollar may be gradual.

The Canadian Dollar is virtually unchanged this morning, yesterday saw the October Inflation report come in slightly lower than expectation at 3.1% but that was mostly because of a big drop in gasoline prices, food prices rose 5.6% so many households are still finding it difficult to get by. Initially the Loonie picked up some strength and USD.CAD hit a low of 1.3690 (07305) but it quickly gave back that strength early this morning.

There is a slew of US secondary data due out today so markets will get a sense of how the US economy is performing before it shuts down for the Thanksgiving holiday tomorrow. After a tough day yesterday, stocks are pointing higher this morning so the US Dollar should remain supported over the next few days while the market is quiet.