The Canadian Dollar got the month off to an amazing start on Friday. By the end of the North American session, with the US Dollar in retreat on the Trump/Flynn story, USD/CAD had suffered its biggest daily drop in 21 months. The pair crashed from 1.2900 to close at 1.2684 with the CAD surging against every currency. AUD/CAD fell a full cent to 0.9650, NZD/CAD fell 80 pips to 0.8745 whilst GBP/CAD tumbled over 3 cents to 1.7100. It’s obviously a bit quieter this morning though the CAD has been pretty resilient in the face of a 50 cent drop in crude oil prices and opens in North America at USD/CAD1.2685. Looking forward, the Bank of Canada holds its 8th and final monetary policy meeting of the year on Thursday. Compared to the economic situation at its last meeting in October, retail sales, the labor market, housing market, manufacturing activity, trade and oil prices have all improved somewhat though inflation has eased a bit lower. Markets are pricing around a 50% probability of a rate hike in January. Though they could react quite sharply to any clear steer from Governor Poloz, it’s hard to imagine much more volatility for the CAD than we saw at the very end of last week.