GFX Morning FX Commentary

Good Morning,

Today’s expected range for the Canadian Dollar against the US Dollar is 1.1425-1.1500

Today’s expected range for the Canadian Dollar against the Euro is 1.4170-1.4240

Today’s expected range for the Canadian Dollar against Sterling is 1.7960-1.8030

The US Dollar is for the most part unchanged this morning, the dollar was much weaker yesterday especially against the Yen where USD.JPY fell over 200 points in active trading. The scenario of falling oil prices and rapidly declining stock markets have led Japanese investors to sell up and bring their money home, we see this develop anytime there is uncertainty in the markets.

Oil is a little lower from where we closed yesterday but still in the recent ranges, the good news is that the quick decline seems to have slowed for the time being. OPEC announced this morning that demand for its oil next year will be the lowest it has been in the last 12 years dropping to 28.8 million barrels a day.

There was more bad economic news out of China this morning and as a result European stock markets were able to make some gains back as it is expected now that the Chinese Government will implement some new stimulus measures to help get growth moving again.

The Canadian Dollar is unchanged against the US Dollar this morning but still looks vulnerable to a USD.CAD move higher, with the strength in the Euro and Sterling yesterday afternoon the Loonie also lost some ground to those currencies as well. I have mentioned this many times before and over the last few months is has proven to be the correct strategy but US Dollar buyers if they want to get any additional value over current markets from their FX transactions need to make sure they take advantage of any pullbacks, the trend for USD.CAD to go higher is still intact and I think will be into the new year.

Up today we get the release of the  Bank of Canada economic review and while we don’t get many surprises from this report I think the dominating theme that the Bank will highlight is the dangerous level of consumer debt in the market. I will also be looking to see if they will comment on the recent drop in oil prices and how it will affect the Canadian economy.

I encourage everyone to read the article below as it is going to have a dramatic effect on the Ontario economy in the next few years. Look at what has happened to countries like Ireland, Portugal and Greece, I think we will see similar effects here in Ontario. Get ready for your taxes to go up and your services to be cut, it is now inevitable.

http://news.nationalpost.com/2014/12/09/ontario-auditor-general-sounds-alarm-over-provinces-growing-debt-325-billion-by-2018/

 

Have a great day
Mike

GFX Morning Currency Rates
Currencies	7:00am Today's Opening				Yesterday's Opening
USD/CAD		1.1461			1.1466
CAD/USD		0.8725			0.8721
EUR/USD		1.2367			1.2352
EUR/CAD		1.418			1.416
STG/CAD		1.7923			1.7923
AUD/CAD		0.9544			0.9494
CAD/JPY		104.07			104.63
CAD/CHF		0.8475			0.8787
CAD/HKD		6.7404			6.74
CAD/CNY		5.3851			5.3969
CAD/MXN		12.6005			12.5427
Commodities
Gold		$1,226.00			$1,205.00
OIL		$62.70			$63.85
US DOLLAR INDEX
P.CLOSE		88.72			89.16
OPEN		88.73			88.91
US 10YR YIELD		2.21%			2.26%