GDP report shows that the U.S. economy’s fourth-quarter growth rate dropped to 3.2%

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

US Dollar        1.3550-1.3650

Euro                1.4650-1.4750

Sterling           1.7150-1.7250

WTI Oil (opening level) $78.06

The US Dollar index was stronger this morning and stocks are pointing lower once again as the market get set for the second reading on the US GDP report. The numbers are expected to confirm that the US economy grew at a 3.3% rate in the 4th quarter which would be a drop from the 4.9% growth rate the economy saw it the third quarter. If there are no changes to the report the US Dollar should remain supported ahead of the key inflation data tomorrow. In fact, US economy grew solid 3.2% in fourth quarter, a slight downgrade from government’s initial estimate

The Canadian Dollar is considerably lower this morning as USD.CAD moved to a high of 1.3600 (0.7353) after trading as low as 1.3490 (0.7413) yesterday. The Loonie was affected by the strong US Dollar but also drops in other "commodity currencies" like the New Zealand and Australian Dollars as those countries reported inflation numbers that were lower than expectation. The Loonie will continue to be affected by the developments around the globe until we see some new data on the Canadian economy.

In addition to the GDP data due out today we get a slew of Federal Reserve members giving speeches so the market will continue to look for any clues on when the Fed wants to start cutting interest rates. A strong GDP report should help stocks recover and push the Dollar a little lower.