GFX Morning Commentary, March 21st, 2012

Good Morning,

Todays suggested range for the Canadian dollar against the US Dollar is .9850 - .9950.

Todays suggested range for the Canadian dollar against the Euro is 1.3080-1.3200

Todays suggested range for the Canadian dollar against Sterling is 1.5670-1.5700

The US Dollar is weaker this morning has the Euro has jumped on the news that the Greek Parliament has approved the final draft of the EU bailout. One of the key conditions of the bailout was that future governments could not alter the plan, with a Greek election rapidly approaching we will see if this holds true over the long run. EURO.USD which had looked like it wanted to trade weaker this morning jumped overnight to trade at a high of 1.3280 but has since given back a lot of these gains.

The European markets today will be watching the UK budget release to see if they are sticking with their plan to reduce the deficit, we could see some enhanced volatility in the Sterling market this morning if they talk about increasing spending, if the deficit targets are raised then Sterling should weaken off and the bond rating agencies will downgrade UK sovereign debt, if they have lower deficit targets Sterling should jump and the rating agencies may lay off for a while.

The Canadian dollar continues to oscillate around the .9900 level, with the US dollar weaker overnight USD.CAD fell back towards the .9890 level and looks this morning like it wants to test lower. While the Canadian Dollar has been extremely quiet against the US Dollar, the Loonie has been very active against the Euro and Sterling but this is more a function of activity in the EU zone and the UK than any particular attention paid to the Loonie.

For today with North American equity markets pointing higher to start the day, the first move for USD.CAD should be toward the .9875 level, we do get the release of US housing data for February and the Canadian Leading Indicators for February, these numbers should not have a dramatic effect on today’s activity but  the markets will be looking for continued signs of improvement in the US.

Have a great day

Mike

GFX Morning Currency Rates
Wednesday, March 21 2012
Currencies	7:00am Today's Opening				Yesterday's Opening
USD/CAD		0.9893			0.9916
CAD/USD		1.0108			1.0085
EUR/USD		1.325			1.3202
EUR/CAD		1.3112			1.3094
STG/CAD		1.5702			1.5733
AUD/CAD		1.0355			1.0402
CAD/JPY		84.84			84.44
CAD/CHF		0.9192			0.9207
CAD/HKD		7.8456			7.8273
CAD/CNY		6.3872			6.3742
Commodities
Gold		$1,655			$1,648
OIL		$106.57			$107.28
Option Volatility
Canada
O/N		10.75%			10.80%
1 Week		8.18%			8.22%
1 Month		8.24%			8.08%