Investors continue to buy equities, taking the passing of the new infrastructure bill as a further sign that the U.S. economy has room to grow. Additionally, China posted a record monthly trade surplus in October as exports surged despite global supply-chain disruptions. Global trade has been running at record levels this year as economies around the world recovered from virus-induced lockdowns in 2020. That has put strain on supply chains in many countries due to shortages of containers and ships as well as capacity at ports, including drivers who deliver goods to retailers.
Meanwhile, the Federal Reserve acknowledged that inflation is well above a manageable level and has said it would closely monitor its direction, we know the Fed is tapering its bond purchases, but it may have to decrease even faster if inflation does not diminish, and it may have to raise interest rates sooner than anticipated.
The Canadian dollar is relatively unchanged, expect a narrow range, the currency will be torn between stronger commodities while having a mediocre domestic economy. If the CAD rallies much more to the USD, it may cause the economy to falter as exports become more expensive in the global economic market.
Expect a narrow range today, with a slight positive bias.
Currently* Close Range
USDCAD 1.2442 1.2454 1.2435-1.2465
EURCAD 1.4422 1.4404 1.4379-1.4436
GBPCAD 1.6875 1.6805 1.6763-1.6908
*Indicative rates only
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