GFX Morning Commentary October 15th, 2013

Good Morning,

Today's expected range for the Canadian Dollar against the US Dollar is 1.0330-1.0400

Today's expected range for the Canadian Dollar against the Euro is 1.3950-1.4020

Today's expected range for the Canadian Dollar against Sterling is 1.6480-1.6550

The US Dollar is marginally stronger this morning as the debate on the US debt ceiling continues unabated. There now seems to be some guarded optimism in the Senate that a deal can be reached but there is still concern that the Republicans in the House will not allow the motion through, as long as this situation exists financial markets will remain nervous.

The Euro also traded weaker on the ZEW investor survey that showed investor confidence in the German economy was declining, I would guess that this is on the back of the situation in the US. There was also an article in the Chinese State newspaper this weekend that called for an end to the American domination of the Global economy, they cited the 2008 financial crisis as an example of the over dependence and the damage it can do to the global economy. They went on to say that the world should move away from the US Dollar as the reserve currency and diversify their American holdings, since this article was basically written by the Chinese Government I find it funny in the timing of its release but they did hit the nail on the head on a lot of issues, if the US is continually going to play political roulette with the world’s economy then the rest of the world has to do something.

With the Thanksgiving Day holiday and the Columbus Day holiday both taking place yesterday the Canadian Dollar had a very quiet trading day and opens not far from where we left it on Friday. Today the Loonie will continue to trade on any news out of the US, as we have seen in the last few days if we get good news out of Washington then USD.CAD will fall back, it the US Government heads to a default on its obligation the USD.CAD will quickly run much higher.

With only limited economic data out this morning Canadian Dollar traders will be monitoring the news wires for any developments south of the border, I think US Dollar buyers need to be very aware of what is happening, the bigger risk at the moment is for a move higher for USD.CAD.

Have a great week

Mike

GFX Morning Currency Rates
Currencies	7:00am Today's Opening				Yesterday's Opening
USD/CAD		1.0356			1.0392
CAD/USD		0.9652			0.9622
EUR/USD		1.3484			1.3569
EUR/CAD		1.3967			1.4101
STG/CAD		1.6491			1.66
AUD/CAD		0.9863			0.9844
CAD/JPY		95.17			94.52
CAD/CHF		0.8848			0.8753
CAD/HKD		7.48			7.4557
CAD/CNY		5.8917			5.8848
CAD/MXN		12.5497			12.59
Commodities
Gold		$1,254.00			$1,285.00
OIL		$101.84			$101.67
US DOLLAR INDEX
P.CLOSE		80.38			80.57
OPEN		80.75			80.39
US 10YR YIELD		2.72%			2.69%