GFX Morning FX Commentary November 23rd, 2012

Good Morning,

Today’s expected range for the Canadian Dollar against the US Dollar is .9930-1.0000

Today’s expected range for the Canadian Dollar against the Euro is 1.2840-1.2900

Today’s expected range for the Canadian Dollar against Sterling is 1.5860-1.5925

The US Dollar is marginally weaker this morning as EURO.USD has reached a three week high on a better than expected business confidence report in Germany. If EU leaders can now get their act together on Greece then you may see EURO.USD jump back towards 1.3000 in the coming days. I would still favour selling the Euro on any strength as there are many other problems that EU leaders are not effectively dealing with and they are sure to weigh on global markets.

Another problem in the Middle East this morning as Egyptian leader Morsi announced that he was giving himself absolute power over the country. Protests are taking place in Tahrir Square but this time you will have opposing sides facing off, the Muslim Brotherhood against the rest of the country that wants democracy. Given the size of the demonstrations last year I could easily see this leading to a civil war.

The Canadian Dollar has opened and closed in North America at the same level for the past two days, so to say that currency traders are ignoring the Canadian Dollar might  be a bit of an understatement. I am not holding out much hope for a big range today as currency traders on both sides of the border are out shopping at WalMart at the moment. I parked at the Eaton Centre this morning and the stores were open at 6:00 am and the Mall was quite busy, hopefully Canadian retailers will fare better and take a bite out of cross border shopping. Financial markets will watch closely the Black Friday sales over the next few days, they will be looking for any signs that US consumers are out spending this holiday season, I am not sure when the numbers from today are released, it might be Monday but if sales are down look for equities to get hit hard and the US Dollar will jump. Again another reason for US Dollar buyers to think about putting on some forward contract at present levels.

The Smiths will be out and about tonight watching the Vanier Cup at the Rogers Centre, I went to McMaster some 100 years ago (as did child #3, she graduated just last year) so we will be out in force to cheer on the Marauders, have a great weekend and enjoy the Grey Cup.

Mike

GFX Morning Currency Rates
Currencies	7:00am Today's Opening				Yesterday's Opening
USD/CAD		0.9968			0.9965
CAD/USD		1.0032			1.0035
EUR/USD		1.2901			1.2874
EUR/CAD		1.2861			1.2831
STG/CAD		1.5892			1.59
AUD/CAD		1.04			1.0333
CAD/JPY		82.5			82.88
CAD/CHF		0.9366			0.9385
CAD/HKD		7.7536			7.7574
CAD/CNY		6.2468			6.2483
CAD/MXN		13.0758			13.0594
Commodities
Gold		$1,734			$1,730
OIL		$87.18			$87.49
Option Volatility
Canada
O/N		5.09%			5.75%
1 Week		4.96%			4.85%
1 Month		5.50%			5.50%