Currency Markets Tread Cautiously as US Dollar Edges Higher; Canadian Dollar Maintains Steady Course Ahead of Employment Data

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

US Dollar        1.3450-1.3550

Euro                1.4450-1.4550

Sterling           1.6950-1.7050

WTI Oil (opening level) $74.96

The US Dollar Index is marginally stronger this morning picking up some gains overnight after it traded weaker yesterday afternoon, again the currency market is trading in tight ranges as it awaits a clear direction from the world's central banks on when interest rate cuts are coming. The only important news overnight was the Chinese inflation report that showed prices actually dropped last month which now has the government their worried about deflation which can be worse than inflation.

The Canadian Dollar traded in a very narrow range over the last 24-hours, it initially moved to the bottom of the expected range yesterday when the Greenback was trading weaker but overnight gave back that strength and is now trading back into the middle of the range, things are so quiet at the moment I did not need to update any on the expected ranges for today. USD.CAD opens the day near the 1.3475 (0.7421) level and should have a quiet day.

There is nothing of note on the calendar today, we do get a number of Federal Reserve members giving speeches but I doubt they will move the market. Tomorrow we get the January employment report out of Canada and the expectation is for the creation of 15K new jobs to have been created but as we know this number can be all over the map.