GFX Morning Commentary, March 14th, 2012

Good Morning,

Today’s expected range for the Canadian Dollar against the US Dollar is .9850-.9950

Today’s expected range for the Canadian Dollar against the Euro is 1.2940-1.3050

Today’s expected range for the Canadian Dollar against Sterling is 1.5550-1.5650

The US Dollar is mixed this morning in quiet trading conditions as equity markets liked what they heard from the US Federal Reserve yesterday who forecast "moderate growth" for the US economy, that is a change from their last statement where they forecast "modest" growth, I am not quite sure what the difference between “modest” and “moderate” is but I am sure it must be a big change, sometimes Central Bank speak is very difficult to interpret.

Equity markets also got a boost late yesterday from the latest US commercial bank stress tests being released where the large percentage of them (4 of 19 failed ) passed and with JP Morgan Chase announcing a massive share  buyback program and increased dividends. It certainly appears that along with the modest recovery in the overall US economy, the American financial sector seems to be on more solid footing now, hopefully that will help push the recovery along.

In China the Equity markets were all much lower as the Chinese premier came out and said he was worried about the domestic housing market and with prices needing to stabilize their would no further easing of interest rates in the near future, this development did not have a ripple effect as European markets are all higher but overall I get a sense that investors are worried about future Chinese growth, if China does slowdown it will be a negative for the Canadian Dollar.

The Canadian is marginally weaker as USD.CAD moved a little higher in overnight trading. With no surprises from the Federal Reserve yesterday there is little on the immediate horizon that will push the Loonie in any significant direction, I still look for this back and forth trading for the next little while.

North American equity markets are pointing higher to start the session so look for USD.CAD to try and move back below .9900 but overall we should have a quiet day.

Have a great day

Mike

GFX Morning FX Rates
Wednesday March 14th, 2012
Currencies	7:00am Today's Opening				Yesterday's Opening
USD/CAD		0.9915			0.9838
CAD/USD		1.0085			1.0103
EUR/USD		1.3065			1.3119
EUR/CAD		1.2956			1.2988
STG/CAD		1.5565			1.5498
AUD/CAD		1.0381			1.0428
CAD/JPY		84.15			83.4500
CAD/CHF		0.934			0.9285
CAD/HKD		7.8277			7.8392
CAD/CNY		6.3861			6.3908
Commodities
		$1,659.01
Gold		$106.51			$1,693.78
OIL					$106.89
Option Volatility
Canada
O/N					11.75%
1 Week					9.03%
1 Month					8.67%