USD/CAD - Loonie Vs. Soft Greenback

The Canadian dollar is down against its U.S. counterpart and flat against its G7 counterparts. Canadian Foreign Securities Purchases this morning were in line with expectations. Later this morning, investors pondered the Bank of Canada Business Outlook Survey. The most significant event risk this week will be Friday Consumer Price Index and Retail Sales figures. WTI Crude jumped 1.67% overnight to $52.31 U.S. per barrel after tensions in Iraq’s Kurd region are sparking speculation of disruption in the supply chain.

Economic data from the U.S. is light this morning with only Empire State Manufacturing, and expectations are for 20.45. With a weak inflation reading on Friday, two Fed members reiterated the need to move to more normalized level in interest rates. First, Chair Janet Yellen in a speech to the G30 in Washington said the she does not expect low inflation to persist. Second, in an interview on Saturday Boston Federal Reserve Bank President Eric Rosengren said the Federal Reserve should move away from its accommodative stance and raise interest rates on a quarterly basis. The dollar index is up 0.02% to start the week.

Experts expect a range today of $1.2469 to $1.2585

The Euro-zone Trade Balance in August released better than expected at 21.6 billion. Reports have indicated that the European Central Bank is looking to extend Quantitative Easing, but at a reduced rate from EUR60 billion/month to EUR25-30 billion/month. In Austria news, voters elected a conservative/right wing government over the weekend. The euro is currently trading at $1.4799.

Observers expect a range today of $1.4739 to $1.4831

No event risk out of the U.K. this morning, but the ball will start to roll tomorrow when inflation data releases along with members of the Bank of England appearing before the Treasury Committee. The pound is currently trading at $1.6624.

Investors expect a range today of $1.6577 to $1.6593

The Australian dollar is relatively flat to start the trading week despite stronger-than-expected Chinese data. The Chinese producer price index jumped 6.9%, beating the estimated figure of 6.6%. The reaction from the Australian dollar was surprisingly muted despite the positive Chinese data. Main event risk will be job data on Wednesday.

Oil (WTI): $52.05 U.S. per barrel

Gold: $1,304.45 U.S. per ounce

Silver: $17.43 U.S. per ounce

Copper: $3.225 U.S. per tonne

Dollar Index: 93.19

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