Morning Commentary & Currency Insights – December 21, 2017

The dollar index is marginally higher after the U.S. Congress passed  a tax reform bill on Wednesday but the reality is markets are winding down dramatically and moves are muted.  Today’s U.S. GDP may spark some interest but look for any movement to be over by London close at noon EST.

USD/CAD has drifted lower as yesterday’s 1.3000 expiries never came to fruition resulting in market participants dumping long USD positions.  Today’s Canadian retail sales &, more importantly, CPI will be scrutinized for insight into future rate moves by the BoC.  Weaker inflation numbers will push us back towards resistance near 1.2900 while strong numbers will see us head towards 1.2750 quickly.