Market watch: US Dollar weakens ahead of inflation report, eyes on Fed's rate cut plans

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

US Dollar        1.3550-1.3650

Euro                1.4700-1.4800

Sterling           1.7150-1.7250

WTI Oil (opening level) $86.59

The US Dollar index is marginally weaker this morning as the market awaits tomorrow's important report on inflation. After the strong employment report from Friday the market continues to discount the number of rate cuts by the Federal Reserve this year and is waiting to hear from the Fed when the first cut will actually occur.

The Canadian picked up a little strength against the US Dollar but also lost ground to the other currencies so overall the Loonie continues to range trade. I missed mentioning yesterday that we get the latest Bank of Canada announcement on interest rates tomorrow and while I don't think they will change their current policy they may start to hint at imminent cuts which should hurt the Loonie in the short-term. US Dollar buyers may want to pick up some US as a precaution in case this happens.

Nothing of note on the calendar today, after a flat day yesterday stocks are again poised for a flat opening as they too await the March inflation report. Once that is published the market should have a little more direction.