The U.S. political environment continues to shake up markets. An announcement that a special investigative committee would look into certain dealings by members of President Donald Trump’s entourage led to a new generalized decline in the U.S. dollar. No doubt Mr. Trump would have probably preferred to celebrate his six-month anniversary on the job another way.
The big winner to emerge from yesterday was the euro. After the European Central Bank (ECB)’s key rate decision, the single currency rose more than 100 points and 125 points against the U.S. dollar and Canadian dollar, respectively. In his press conference, ECB President Mario Draghi tried not to appear overly optimistic, stressing that monetary stimulus measures would remain in place, but in the end, markets appear to have been encouraged by the economic outlook for the Eurozone.
Canadian inflation data will be released today. A reading above economists’ expectations could boost anticipation of further rate hikes in Canada and send the loonie higher.
Julien Duquette