Japanese interest rate hike impact: Global Currency Markets await BOJ decision

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

US Dollar        1.3500-1.3600

Euro                1.4725-1.4825

Sterling           1.7200-1.7300

WTI Oil (opening level) $81.51

The US Dollar index is marginally weaker this morning but that is only after it jumped last week on the stronger than expected inflation data. Traders will now look to Wednesday's Fed interest rate announcement to see if there is any chance that the Fed pushes back the timing of the first interest rate cuts to later in the year. Of interest to currency watchers this week will be the first expected interest rate increase from the Bank of Japan tomorrow. Japan which for many years used negative interest rates to try and stimulate the economy is expected to hike interest rates towards 0% to fight inflation, I will be interested to see if the global stock markets react to this hike.

The Canadian Dollar starts the week on the back foot as USD.CAD opens the week a little higher near the 1.3550 (0.7380) level and in addition the Loonie also lost ground to the other currencies as well. It will be a busy week for the Loonie as we get inflation data today in the form of Producer Price index and then tomorrow, we get the actual inflation rate for February. Make sure you have your orders in as it could get quite volatile.

After a down day on Friday stocks are poised for a positive opening but should remain steady ahead of the Fed announcement on Wednesday.