Thursday 30 May 2013

GFX Afternoon Update May 30 2013

Good Afternoon

The Canadian Dollar has retreated from yesterday's highs against the US Dollar back to the level that was traded at on Friday. This move was initiated by weak GDP numbers from the US and a stronger Canadian current account. These combined to weaken the US Dollar and move away from highs that were reached yesterday. A weaker US Dollar caused the Euro to strengthen and it looks like it will remain at this level for some time. The Euro was unable to use its strength from a weaker US Dollar to help it strengthen against the Canadian Dollar which continues its trend of slowly strengthening. These pairings look like they will trade at this high level for the rest of the day as the most significant data for the day was already released and there is nothing else scheduled for release that will push it out of the range.

The significant release this morning was the US GDP numbers which came in weaker than expected at 2.4%. In addition to GDP numbers the US has released their initial jobless claims which was lower than expected at 354K. These two releases have weakened the US Dollar against all currencies and may slow talks of tapering Quantitative Easing. 


Tomorrow the Canadian GDP numbers will be released which could erase today's move if it comes in weaker than expected. The other big release tomorrow is the EU CPI which could cause some volatility in the Euro when it is released. 

Yonah

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